Iran launched a formal transit authority for the Strait of Hormuz on May 5 — the same day President Trump paused Project Freedom — requiring ships to register, pay a toll, and receive a permit by email before crossing.
The Persian Gulf Strait Authority operates as the official administrative interface for Hormuz passage, run through the Islamic Revolutionary Guard Corps Navy. Ships must contact the authority, complete the required forms, and pay a transit fee before receiving clearance from [email protected] — meaning compliant vessels are effectively paying a US-designated foreign terrorist organization for the right to move.
The PGSA formalizes a system Iran has operated since mid-March. Iran began routing ships around Larak Island through Iranian territorial waters, vetting each vessel through the IRGC before granting passage. Iranian lawmaker Alaeddin Boroujerdi confirmed the practice in late March: “because war has costs, naturally, we must do this and take transit fees from ships passing through the Strait.”
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That informal system attracted scam operators offering fraudulent transit paperwork for cryptocurrency. The PGSA replaces them with a single official channel — but using it now has its own legal consequences.
Just a few days earlier, the US Office of Foreign Assets Control issued an alert warning that firms paying Iran for Hormuz transit could face American sanctions.
Trump announced Project Freedom’s pause on Truth Social, citing diplomatic progress and requests from Pakistan. Tehran’s state media rejected that account, attributing the pause to “firm positions and warnings” from Iran. Iran used the same window to launch the PGSA — institutionalizing its control of the strait at the precise moment the US stepped back.
Iran’s Foreign Minister Abbas Araghchi traveled to Beijing on Wednesday for the first face-to-face talks with his Chinese counterpart since the war began. Trump is scheduled to visit China next week. The PGSA signals Tehran intends to negotiate from a position of structural control over Hormuz, not a temporary military one.
Commercial traffic through the Strait of Hormuz has fallen more than 90% since Operation Epic Fury began on February 28. Pre-war, approximately 3,000 vessels transited the strait each month; only 191 crossings were recorded in all of April. Nearly 23,000 sailors on vessels from 87 countries remain stranded in the Persian Gulf with no evacuation timeline.
The strait carries roughly 20% of the world’s seaborne oil supply. Prices retreated modestly after Project Freedom’s pause but held above $100 a barrel.
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