With Iran's National Security Council officially passing a new bill regarding the Strait of Hormuz, global energy markets have once again entered a state of high tension. The legislation not only establishes a toll collection system for passing vessels but also explicitly bans American and Israeli ships from traversing this critical strategic waterway, marking a shift in Iran's control over the sea area from a de facto blockade to a legalized management framework. Following the announcement, international markets reacted swiftly, pushing U.S. crude futures prices above the psychological threshold of $100 per barrel for the first time since the outbreak of the war.
According to the disclosed core clauses, future financial arrangements and fee systems will be implemented in Iranian Rials, restricting vessel passage for countries participating in unilateral sanctions against Iran. Oman was mentioned as assisting in formulating the relevant legal framework to ensure navigation safety while establishing Iran's sovereign status. The Chairman of the Parliamentary Civil Affairs Committee stated that since Iran provides security guarantees, collecting fees follows natural logic; the move aims to elevate national status, transforming the country from a sanctioned nation into a regional powerhouse. In fact, since mid-March, the Islamic Revolutionary Guard Corps had already begun implementing actual charges on certain merchant ships, with single voyages reaching up to $2 million. Some vessels even settled payments in Renminbi, passing through specific channels under exclusive identification codes and escort.
Against the backdrop of surging geopolitical risks, international oil prices witnessed a significant rebound. By the Monday close, the New York May crude contract gained over 3%, settling at $102.88 per barrel, marking a new high since July 2022. Brent crude also recorded an approximate 3% rise during the same period, nearing $113.4 per barrel. The overall surge in March created the largest monthly increase in the contract's history, accumulating nearly 55%. This reflects the market re-pricing the risk of long-term supply interruptions in the Middle East, with investors concerned that the situation could evolve into a prolonged energy crisis.
Meanwhile, military confrontation continues to escalate. The U.S. Secretary of State publicly criticized Iran's toll plan as illegal and unacceptable, deeming it a danger to the world. In response, the U.S. military is accelerating troop reinforcements to the Middle East, including the amphibious assault ship USS Tripoli arriving in the designated zone. With embarked Marines and other units, the total number of U.S. troops locally is expected to exceed 50,000. President Trump issued a stern warning on social media, stating that if no agreement is reached in the short term to restore navigation, he would consider destroying all of Iran's power stations, oil wells, and facilities on Kharg Island. The Secretary-General of the Gulf Cooperation Council also condemned the action as violating the UN Convention on the Law of the Sea, although Iran has not formally ratified the convention. Nevertheless, concerns internationally regarding conflict spillover into the economic domain are intensifying.
