Strait of Hormuz Toll Plan Calls for Punitive Terms
Median Toll on China assessed at $0.60 while EU assessed $1.35 per barrel
Tim’s Summary
When will the arrangements for the post-Petrodollar world be fully worked-out? I see an evolution taking place with Iran’s and Oman’s1 Strait of Hormuz toll.
It looks like all the incentives point towards continued escalation because, among other reasons, the US establishment will not accept the Iranian fracturing of the Petrodollar:
Means of Payment
It appears like the Iranians are willing to accept the following means of payment, but my sense is that these arrangements are fluid:
Chinese Yuan
Euros
Bitcoin
Stable Coins: Tether (USDT)
Punitive Tolls: punish adversaries
Iran is discriminating against their Adversaries and Enemies. One might think of this as retaliation for the US weaponization of the dollar through sanctions and seizures, but I wonder if this is/or will constitute another exorbitant privilege that Iran can wield as a cudgel against anyone who crosses them or their Chinese or Russsian allies.2 It also serves as a way to generate reparations for Iran to rebuild post-war.
Tiered Pricing: Fees are reportedly set based on a “friendliness ranking” of the vessel’s flag state:
Allies (e.g., China, Russia): $0.50 – $0.70 per barrel.
Neutral/Friendly (e.g., India): $0.80 – $1.00 per barrel.
High-Risk (e.g., EU, Japan, South Korea): $1.20 – $1.50 per barrel.
Hostile (U.S., Israel): Generally prohibited from passage or subject to seizure.
DETAILS:
1) Euro-based Toll:
On. April 4th , Iran proposed a deal with Europe that would allow Europe to buy Persian Gulf Oil using Euros.
.. If Europe accepts this deal, demand for the dollar will decline, reducing reserve currency holdings and the US’s ability to fund military operations under favourable terms. This poses a serious threat to the global financial system currently built on dollar dominance. (UA News)
2) Crypto-based Toll:
Interestingly, the toll can be paid with US dollar Stable Coins.3
On Tuesday the 7th, the Financial Times published a story titled “Iran demands crypto fees for ships passing Hormuz during ceasefire”
Before the halt Hosseini said that any tanker passing must email authorities about its cargo, after which Iran will inform them of the toll to be paid in digital currencies.
He said that the tariff is $1 per barrel of oil, adding that empty tankers can pass freely.
“Once the email arrives and Iran completes its assessment, vessels are given a few seconds to pay in bitcoin, ensuring they can’t be traced or confiscated due to sanctions,” Hosseini added.
.. Around 10 to 15 ships might be able to transit the strait per day as the process was “quite time-consuming”, he said, down from 135 ships before the war.
Q: What types of crypto is Iran accepting to pay the toll at the Strait of Hormuz? (AI)
GEMINI: Reports from early April 2026 indicate that Iran has begun enforcing a formal toll system for vessels transiting the Strait of Hormuz, requiring payments in specific digital assets to bypass the U.S. dollar-based financial system.
According to reports from the Financial Times and Bloomberg, the Islamic Revolutionary Guard Corps (IRGC) is primarily accepting the following for passage:
Accepted Payment Methods
Bitcoin (BTC): Iranian officials, including spokespeople for the oil exporters’ union, have publicly named Bitcoin as a primary requirement. They argue it provides a “sanction-proof” method that is difficult for Western authorities to freeze.
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Stablecoins (USDT/USDC): While officials have highlighted Bitcoin, industry reports indicate that Tether (USDT) and other USD-pegged stablecoins are frequently used in practice. These are preferred for their price stability during the short window between invoicing and payment.
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Chinese Yuan (RMB): For non-crypto options, Iran is accepting wire transfers in yuan, typically routed through Kunlun Bank via China’s Cross-Border Interbank Payment System (CIPS).
The Toll Structure & Process
The system is part of the “Strait of Hormuz Management Plan” codified by the Iranian Parliament [in March 31], 2026. The process for shipping companies generally follows these steps:
Vetting: Tanker operators must email cargo manifests, ownership records, and AIS tracking data to an IRGC-linked intermediary.
Tiered Pricing: Fees are reportedly set based on a “friendliness ranking” of the vessel’s flag state:
Allies (e.g., China, Russia): $0.50 – $0.70 per barrel.
Neutral/Friendly (e.g., India): $0.80 – $1.00 per barrel.
High-Risk (e.g., EU, Japan, South Korea): $1.20 – $1.50 per barrel.
Hostile (U.S., Israel): Generally prohibited from passage or subject to seizure.
Payment Window: Once approved, operators are reportedly given a very narrow window (sometimes cited as “seconds”) to transfer the crypto to an IRGC-controlled wallet to receive a VHF-broadcast passcode for safe passage.
Important Context
Legality and Risk: Paying these tolls carries significant legal risk for international shipping firms. The U.S. Treasury (OFAC) has historically sanctioned Iranian crypto wallets, and paying the IRGC—a designated Foreign Terrorist Organization—can lead to severe secondary sanctions and the freezing of company assets.
Fragile Ceasefire: This toll system emerged during a fragile two-week ceasefire in April 2026. While Iran frames these as “transit fees” for security and naval escort, Western nations and Gulf neighbors view the move as an illegal “tax” on an international waterway.
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Disclaimer: This information is based on current reports regarding geopolitical developments and does not constitute legal or financial advice regarding sanctions compliance or cryptocurrency transactions.
Elsewhere:
France moves 129 tonnes of gold from the New York Federal Reserve April 8, 2026 (Chinese funded) - central banks want to be able to control their gold. One reason may be to be able to defend their currency during a time of volatility.
This also has echoes of 1971, which started in 1965 with France announcing that they French withdrew gold. The Frech sent (a Battleship?) to New York to withdraw their gold, precipitating the US default on the dollar’s convertibility to gold on Aug 15, 2026.
Song: Who would Jesus Bomb? (Rainbow Girls)
This song was written by Jordan Smart ( original | album)
FOOTNOTES:
Iran has proposed splitting their “toll” with Oman in their 10 demands. Oman, shares the other side of the strait. This would give the two a united front against those wanting to cross the Strait, but Oman has disputed this arrangement.
Perhaps Iran will tell countries that we will make the toll higher if you don’t vote our way at the UN.. Perhaps they would have a special BRICS rate that penalizes the Non-BRICS countries. The options are limitless, although the more punitive or discriminatory the more the US will fight them.
I wonder why the dollar is allowed in stablecoin format, but not traditional dollars? Is their not similar ability to freeze or seize Tether (USDT).
It looks as through there is the ability to freeze, seize, and trace Tether (USDT)