Iran’s Islamic Revolutionary Guard Corps has begun accepting yuan-denominated passage fees in the Strait of Hormuz, routing payments through Chinese maritime intermediaries while Tehran’s parliament advances legislation to make the practice permanent, shipping intelligence firm Lloyd’s List confirmed Thursday.
The system — which maritime analysts have labeled the “Tehran Toll Booth” — runs through IRGC-linked intermediaries that pull vessel identification, full crew rosters, cargo details, and ownership records before passing each file for sanctions screening and what Iranian sources describe as geopolitical review. Cleared vessels are then issued authorization codes and escorted by IRGC pilot boats through a dedicated corridor around Larak Island, well inside Iranian territorial waters.
Lloyd’s List Intelligence, citing three sources familiar with the arrangement, confirmed that at least two vessels have paid transit fees in yuan, with one transit brokered by a Chinese maritime services company that also handled payment to Iranian authorities on behalf of the shipowner.
Sponsored · First Phosphate Corp.
Strait traffic has collapsed since the US-Israel military campaign began on February 28, dropping 90% from a pre-war average of more than 130 daily transits to fewer than 10. Iran has attacked at least 18 vessels in and around the Persian Gulf since the outbreak of war, according to International Maritime Organization data, fueling an insurance crisis that has kept most commercial operators away from the route.
Iranian lawmaker Mohammadreza Rezaei Kouchi told the state-aligned Fars and Tasnim news agencies — both editorially close to the IRGC — that parliament is now moving to codify the arrangement into law. “We provide its security, and it is natural that ships and oil tankers should pay such fees,” he said. A preliminary draft bill is ready but has not yet reached a full parliamentary vote.
Analysts tracking dollar-alternative payment systems flagged a sharp rise in transaction volumes on China’s Cross-Border Interbank Payment System (CIPS) this March — the highest levels recorded in over a year — consistent with reports that Iran has demanded yuan settlement for both oil exports and Hormuz transit fees.
The Gulf Cooperation Council’s secretary-general, Jasem Mohamed al-Budaiwi, condemned the charges as “an aggression and a violation of the United Nations agreement on the law of the sea.” Maritime law scholars noted that Iran holds a legitimate territorial claim over the narrowest section of the strait but faces legal limits on the extent of that authority.
Sponsored · Nord Precious Metals
Automatic Identification System data reviewed by Newsweek tracked 26 vetted vessels on the IRGC-controlled corridor between March 13 and March 25. Ships from Malaysia, China, Egypt, South Korea, and India have transited under the system.
The disruption has driven Brent crude above $104 a barrel, a gain of more than 40% since the war’s start. Iran has included sovereignty over the Strait of Hormuz among the five stated conditions for any ceasefire agreement.
Read: Iran Tables Demands: No Talks Without Base Closures, Sanctions Relief, and Hormuz Fees
Legal and sanctions specialists cautioned that yuan-routing does not insulate these transactions from US enforcement. Payments made to IRGC-linked entities likely violate existing American and European sanctions on the Guard regardless of the currency denomination, according to the Associated Press.
Israel announced Thursday that an airstrike had killed IRGC Navy Commander Alireza Tangsiri, the officer Israeli officials identified as responsible for mining and blockading the strait. Iran had not officially acknowledged his death as of Thursday evening.
Information for this story was found via the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
