Why Hormuz blockade gives Washington crucial leverage as the US and Iran race to strike a 60-day peace deal: What international law says

Iran is wasting little time moving its oil back into global markets.

This came following the easing of naval blockade imposed by the US military around the Strait of Hormuz under an interim agreement that opened the door to 60 days of high-stakes negotiations over Tehran's nuclear programme and the future of the world's most strategically important energy chokepoint.

At least three supertankers carrying roughly 6 million barrels of Iranian crude departed Kharg Island and entered the Strait of Hormuz, openly broadcasting destinations near Singapore, where Iranian oil is commonly transferred ship-to-ship before continuing mainly to China's independent refiners.

Vessel-tracking data based on AIS navigation signals compiled by Bloomberg showed a surge in Iranian crude exports almost immediately after restrictions eased.

The rapid resumption of exports illustrates Tehran's urgency to monetise oil shipments that had accumulated during weeks of disrupted traffic.

But it also underscores a broader strategic reality: despite the easing of military pressure, Iran's oil lifeline remains highly dependent on the United States' ability to control maritime access to the Gulf.

That leverage now sits at the heart of negotiations in Switzerland, where US and Iranian negotiators, with mediation by Pakistan and Qatar, are attempting to convert a fragile ceasefire into a comprehensive agreement covering Iran's nuclear program, sanctions relief and the long-term governance of the Strait of Hormuz.

The United States' military advantage is straightforward.

During the recent conflict, which started on February 28, 2026, physical restrictions on commercial navigation significantly curtailed Iranian oil exports, depriving Tehran of one of its principal sources of foreign currency.

While Iran can harass shipping with missiles, drones, mines and fast attack craft, the US Navy possesses the capability to impose or support a maritime blockade that sharply limits Iran's ability to export crude through the narrow waterway.

The US government, through the Treasury Department, also rachets up financial sanctions on Iran's oil trade, effectively controlling the flow of oil money.

Financial isolation of Iranian oil exports is considered a "pillar" more decisive than a naval action.

The US Treasury’s sanctions architecture works through OFAC authority (Office of Foreign Assets Control), which:

US Treasury Secretary Scott Bessent summarised this strategy bluntly:

“Treasury will continue to constrict the network of vessels, intermediaries and buyers Iran relies on to move its oil… Any person or vessel facilitating these flows risks exposure to US sanctions.”

The Institute for the Study of War (ISW) has stated that Iran’s “management” narrative over Hormuz is coercive signaling, not legal authority, framing Iranian behaviour in maritime chokepoints as “coercive leverage below the threshold of war”, a “gray-zone escalation using geography and proxy forces”.

More importantly, ISW stated that Iran's "management" or "service fee" narrative is an "attempt to convert geographic proximity into political bargaining power”.

President Donald Trump has repeatedly escalated tensions by threatening military action and blockades regarding the Strait of Hormuz.

His threats range from ordering US Navy interdictions on ships paying tolls to Iran, to threatening severe military retaliation if the vital oil corridor is compromised.

On Saturday, he said no tolls would be imposed on ships transiting the Strait of Hormuz for at least 60 days during a ceasefire period with Iran. Mohammad Ghalibaf, Speaker of Parliament of Iran and negotiator, said as much.

Ghalibaf said Iran will start charge Hormuz transit fees after the 60-day fee-free period expires.

Trump, for his part, warned that the US would begin imposing its own tolls in the strait — if a permanent deal with Iran is not reached, as per The Hill.

That makes continued access to Hormuz an economic necessity for Iran —rather than merely a diplomatic objective or "lever".

At the same time, Iran has sought to transform its leverage into legal and political leverage.

Iranian officials have repeatedly insisted that, as a coastal state bordering the Strait alongside Oman, Tehran has the "right" to regulate navigation through the waterway.

Over the recent days, Iranian leaders have alternated between proposing transit "tolls" and later describing them as charges for navigation, security, search-and-rescue and environmental "services".

They argued that such fees would be consistent with Iran's interpretation of international law.

Iran has also maintained that commercial transit through Hormuz should occur in coordination with Iranian authorities.

Senior officials, including Ghalibaf, have publicly asserted that Tehran intends to continue exercising "supervision" over shipping movements through the strait.

These positions remain among the most contentious issues in the ongoing negotiations.

For Washington and its Gulf allies, ensuring uninterrupted and internationally recognised freedom of navigation through Hormuz is a strategic imperative.

Roughly one-fifth of the world's seaborne oil trade normally passes through the narrow waterway, making any disruption an immediate threat to global energy markets.

For Tehran, however, Hormuz represents one of the few remaining sources of geopolitical leverage after years of sanctions.

By asserting a role in "managing" traffic through the strait, Iran hopes to convert geographic advantage into long-term political and economic influence, as per the think-tank Institute of the Study of War.

There's just one problem with Iran's intention — the Strait of Hormuz is a natural waterway, not man-made.

Under Part III of the UN Convention on the Law of the Sea (UNCLOS), Hormuz falls under "Straits Used for International Navigation".

Legal consensus among maritime law scholars (such as Churchill & Lowe; Oxman; Roach & Smith) is:

In other words, Hormuz is the key leverage Iran has and it's using it to the hilt.

Nowhere in international law does it say a coastal state may impose a fee of any kind for transiting ships in a natural waterway used for international navigation.

International law scholars consistently distinguish between:

Coastal states may only impose limited service-related charges, such as:

But crucially:

They cannot impose tolls or transit fees for passage itself through an international strait.

This is supported in standard legal interpretations of UNCLOS:

In clearing Hormuz, the UK and France have pledged spearhead mine-clearing operations and netting unexploded ordnance in the strait to re-open the waterway for shipping.

A key point in the US-Iran power calculus is that even if the IRGC can temporarily disrupt traffic, the US and partners can:

So the balance of power is not “who can disrupt more”.

While Iran can raise costs temporarily; the US can systematically constrain and restore flow over time.

That distinction is central to the credibility of the US blockade.

This makes the current negotiations extend well beyond Iran's nuclear enrichment.

The emerging framework must reconcile several competing objectives, based on certain technical terms:

The preliminary agreement dubbed as a "Memorandum of Understanding (MoU)", signed both by US President Donald Trump and Iranian President Masoud Pezeshkian, suggests both sides recognise that preventing another confrontation in Hormuz is essential.

Negotiators announced progress toward mechanisms designed to safeguard commercial navigation while continuing technical discussions over the next 60 days.

The coming days and weeks will determine whether that MoU, a temporary understanding, can evolve into a permanent settlement, or a deal proves difficult within the mutually-agreed 60-day period .

But one thing is clear: Iran's swift effort to move millions of barrels of crude back onto the market demonstrates how dependent its economy remains on open sea lanes.

At the same time, the US retains a powerful negotiating advantage: if diplomacy collapses, it retains a credible ability to restrict those sea lanes again.

The imbalance and mutual dependence — Iran's need to export oil and Washington's ability to facilitate/impede those exports and Trump's standing before the American electorate as the mid-term elections loom — may prove to be the strongest incentives for both sides to pursue a lasting agreement rather than return to confrontation.