A major geopolitical shift has taken place in West Asia after the United States and Iran signed a new 14-point Memorandum of Understanding (MoU), officially ending the conflict that began on 28 February. The agreement was signed by US President Donald Trump and Iranian President Masoud Pezeshkian, bringing relief to global markets.
One of the most important clauses in the MoU focuses on the future of the Strait of Hormuz, a key global oil transit route. The agreement allows free movement of commercial ships without any toll for the first 60 days. During this period, Iran will also clear sea mines and other wartime obstacles within 30 days to restore safe navigation in the region.
What does the 5th point of the MoU say about Hormuz?
The fifth point of the agreement states that ships will be able to pass through the Strait without paying any toll for 60 days. However, it also mentions that long-term management of the route will be decided later through discussions between Iran and Oman, along with other Gulf countries, under international law.
Why is Iran calling it a ‘service fee’ instead of a toll?
Iranian officials have clarified that after the 60-day period, the country will not impose a traditional toll but will charge a “service fee.” According to Iran’s parliament speaker Mohammad Bagher Ghalibaf, the Strait will not return to pre-war conditions and Iran will charge for services provided to passing ships. These services may include navigation support, environmental protection, insurance coordination, and maritime safety operations.
What could be the global impact of this decision?
Experts say introducing a service fee could increase global shipping costs and raise oil prices. India could also be affected significantly, as it imports a major portion of its crude oil and LPG through this route. Higher shipping costs may increase India’s import bill.
First published on: Jun 19, 2026 09:28 AM IST
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