Iran's Hormuz Safe Insurance and Mandatory Vessel Declarations Reshape Strait of Hormuz Transit - News and Statistics

May 18, 2026

Iran has put forward a plan to oversee the Strait of Hormuz via an insurance-based system that would solidify its authority over the vital oil transit point, while also requiring all ships to submit compulsory cargo reports to a fresh Iranian maritime body before they can pass through. State-run media reported on Sunday that Iran’s Ministry of Economy has crafted a framework called Hormuz Safe, which would manage strait passage by providing marine insurance policies and certificates of financial responsibility. The system employs cryptographic verification and processes payments using Bitcoin. Coverage under this arrangement would first encompass perils such as inspections, detentions, and seizures, but would not cover harm from weapon attacks. Iranian authorities referenced in the Fars News Agency report suggest the platform might ultimately bring in over $10bn in income for Tehran.

Insurance Scheme

The insurance initiative is paired with a distinct and more pressing development for commercial shippers. Iran’s Islamic Revolutionary Guard Corps Navy has declared that any vessel seeking to traverse the strait must now submit a formal Vessel Information Declaration to the recently established Persian Gulf Strait Authority. Ships failing to do so may be refused passage. The declaration obliges vessels to reveal their cargo type, point of origin, destination, operator details, and complete route information before being allowed to proceed. For tankers transporting crude from Saudi Arabia, the UAE, Kuwait, or Iraq, this entails handing over commercially and strategically delicate data to Iranian officials as a prerequisite for transit.

Legal Status

According to the UN Convention on the Law of the Sea, the Strait of Hormuz qualifies as an international strait where all vessels have the right of transit passage. Iran has not signed UNCLOS. A UN resolution backed by 112 nations has formally deemed the PGSA framework unlawful under customary international maritime law, yet no naval force has so far physically contested the new declaration requirement.

Global Response

US Treasury Secretary Scott Bessent stated over the weekend that China, the globe’s biggest oil importer and the primary purchaser of sanctioned Iranian crude, would operate behind the scenes to aid in reopening the strait.

On-Water Situation

On the water, conditions have become increasingly intricate. Maritime intelligence firm Windward has observed that IRGC-linked activity stays high throughout the strait, with fast boats, dhows, coastal vessels, and patrol boats present. Windward remarked in a recent analysis that the outcome is an operational setting where Hormuz operates less like a standard shipping lane and more like a controlled maritime zone defined by positioning, monitoring, enforcement, and reduced visibility.

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