Iran’s New Maritime Control: How the IRGC is Shaping Shipping Routes in the Strait of Hormuz

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Iran has effectively turned passage through the Strait of Hormuz into a selective permit system, and investigators say there are signs some ships paid passage fees in Chinese yuan. After U.S. and Israeli strikes on Iran, traffic through the strait has fallen sharply, and analysts warn Tehran is consolidating control of the route through the Islamic Revolutionary Guard Corps (IRGC).

On March 27, Lloyd’s List and the Associated Press reported that ships now transiting the Strait are hugging Iran’s territorial waters along a northern route approved by Tehran. Shipping companies are required to submit each vessel’s International Maritime Organization (IMO) registration number, ownership structure, cargo manifest, destination and crew details in advance for IRGC screening. Vessels that pass the review are issued an approval code and routing instructions.

Lloyd’s List says at least two vessels paid for safe passage and that the transactions were conducted in Chinese yuan. The amounts were not disclosed, and Iranian authorities have not formally recognized the practice as official policy.

The profile of ships using the strait has shifted sharply. Of the 142 vessels that transited the Strait of Hormuz this month, 67% had direct ties to Iran through trade or ownership. In recent days that share has climbed to about 90%, signaling a reorganization of traffic around Iranian-linked or Iran-coordinated ships rather than typical commercial tonnage.

Iran says it allows conditional passage only for non-hostile vessels. Reuters reports Tehran told the U.N. and the International Maritime Organization that non-hostile ships may transit the strait if they coordinate with Iranian authorities.

The situation has intensified pressure on the shipping industry. Because the IRGC is designated by the U.S. as a Foreign Terrorist Organization (FTO), payments or other dealings with it could raise sanctions-violation concerns. Former U.S. Treasury Department Office of Foreign Assets Control official Claire McCleskey warned that “providing material support to the IRGC could expose companies to criminal as well as civil liability.” Ships face a stark choice: risk attack if they refuse to seek Iran’s approval, or face heightened sanctions risk if they comply with Iran’s approval process.