Iran’s parliament is reviewing legislation that would effectively give Tehran regulatory dominion over one of the most important chokepoints in global trade. The proposed law would ban vessels linked to the United States, Israel, and other nations Iran considers hostile from transiting the Strait of Hormuz unless they pay compensation for war-related damages.
Roughly one-fifth of the world’s oil consumption passes through this narrow waterway between Iran and Oman.
What the legislation actually does
The bill, first announced by Iranian lawmaker Mohammad Reza Rezaei Kouchi on April 19, 2026, goes well beyond symbolic posturing. It proposes transit fees that could reach 7% of a vessel’s cargo value for ships passing through waters Iran claims to regulate.
For vessels that refuse to comply, the penalties escalate sharply. Iranian state media reports that fines could climb to 20% of the total cargo value.
