Oman proposes Hormuz management system with voluntary fees, source says

RIYADH — Oman has presented a proposal to Iran for joint regional management of the Strait of Hormuz with shipping firms paying voluntary fees, a Gulf source told Reuters on Tuesday.

The Strait of Hormuz—which carried a fifth of global oil and liquefied natural gas before the Iran war—has become the main hurdle in peace talks and a flashpoint for repeated escalations in the conflict.

Iran has said the strait cannot go back to its pre-war status where shipping flowed freely, while Gulf states insist there be no mandatory payment of fees to Iran.

Under the Omani proposal, which has regional backing and was presented to Iranian officials over the weekend in Tehran, Iran would not exercise sole control over the strait, the source added.

The proposal is based on the Strait of Malacca, which connects the Indian and Pacific Oceans and is jointly managed by the states bordering it: Indonesia, Malaysia, and Singapore.

READ: What is the Malacca Strait, the world’s largest ‘chokepoint’?

There, shipping firms make contributions for the upkeep of navigational safety aids including buoys and lighthouses.

Similarly under the Omani proposal, those using the Strait of Hormuz would voluntarily contribute to a fund that finances the cost of managing navigation, environmental protection and search and rescue, among other services.

An Omani foreign ministry official did not respond to a request for comment.

The UN's International Maritime Organization said it was not involved in the discussions.

"Any proposal for new shipping routes or traffic management measures should be submitted to IMO for consideration by member states," an IMO spokesperson said.

The IMO established the recognized international shipping lanes through the Strait of Hormuz in 1968.

These are currently unusable due to the risk of Iranian mines, with Tehran calling on shipping to take a route closer to the Iranian coast and the US offering assistance to vessels using a route closer to Oman.

Oman's delegation told a session of the IMO's governing council on July 9 that it "does not support the imposition of transit fees on vessels passing through the strait."

"At the same time ... Oman sees merit in exploring voluntary arrangements relating to navigational support services," it said.

Iran's Foreign Minister Abbas Araqchi discussed the Strait of Hormuz with his Omani and Saudi counterparts on Monday.

"He emphasized the need to strengthen cooperation and advance joint diplomatic efforts to establish stability in the region, and lift the insecurity imposed on the Strait of Hormuz due to the aggressive actions of the United States," according to Iran's foreign ministry statement.

President Donald Trump said on Monday the United States was having "good ‌talks" with Iran and there was a chance of a deal, but he warned that US strikes would resume if the negotiations failed to deliver. — Reuters