Proposed Hormuz passage deal not feasible for shipping industry: Report
Proposed Hormuz passage deal not feasible for shipping industry: Report A proposed deal between Iran and Oman that would give Tehran control over ships entering the Gulf through the Strait of Hormuz is not easily workable due to US sanctions and restrictive insurance clauses on any payments, four industry sources told Reuters. Under the latest proposal, Tehran would be able to intervene if…
The proposed Hormuz passage deal, which would grant Iran control over ships entering the Gulf through the Strait of Hormuz, has been deemed unfeasible for the shipping industry, according to a report by Reuters. The issue stems from US sanctions and restrictive insurance clauses that would make any payments through the deal problematic.
The proposed deal would allow Tehran to intervene in inbound traffic and require outbound traffic to follow a route between Iran and Oman, with exit clearance granted through Oman after notifying Iran. Leading shipping associations have expressed concern, stating that introducing compulsory charges through the strait would be a toll in all but name and could undermine the internationally recognized legal framework governing straits used for international navigation and transit passage.
The UN's shipping agency adopted a two-way traffic separation scheme in 1968 with the agreement of countries in the region, which created the current ship routing system that splits sailing corridors through Iranian and Omani waters.
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