Control of the Strait of Hormuz has emerged as the central fault line in US-Iran negotiations, with US President Donald Trump appearing to recast an earlier off-the-cuff idea into a more formal proposal that seeks to bridge Tehran’s push for dominance and Washington’s insistence on open passage.
Following his Tuesday announcement of a two-week ceasefire, Trump on Wednesday told the American Broadcasting Company that his administration may seek a “joint venture” with Iran to safeguard the global chokepoint, on which Tehran has maintained a tight grip since the conflict began on February 28.
“We’re thinking of doing it as a joint venture. It’s a way of securing it – also securing it from lots of other people,” he said, hailing the idea as a “beautiful thing”.
White House press secretary Karoline Leavitt on Wednesday responded to press queries on the issue, saying: “It’s an idea the president has floated, as you know, and it’s something that will continue to be discussed over the course of the next two weeks”.
When pressed on the issue of Iran charging a toll and reports that the narrow waterway remains closed despite the ceasefire agreement, she emphasised that the US had not yet “definitively” accepted the plan.
“The joint venture is something that was proposed by the president, but he was very clear in his statement last night, he wants to see the strait reopened immediately, without limitation,” Leavitt added.
Trump aims to transform a strategic military chokepoint into a revenue-generating venture, drawing comparisons to the Panama Canal and proposing a toll system for passage.
The president’s earlier remarks suggest the plan hinges on the US providing security while countries that rely on the route, such as China and Europe, bear the cost.
“Why are we protecting the ships for China? Why are we protecting them for France? They aren’t even helping us,” Trump said earlier this month.
“From now on, they pay or they don’t get through. We’re going to bill them, and it’s going to be a lot of money.”
On Monday, Trump talked about the US charging its own tolls on the Strait of Hormuz.
“What about us charging tolls?” he told reporters. “I’d rather do that than let them have them. Why shouldn’t we? We’re the winner. We won.”
Analysts label the plan ‘unrealistic’ and impractical
Some reports have floated estimates that the fee could be around US$2 million per ship, to be shared between the US, Iran and regional partners.
In early March, Trump began pressuring allies like the UK, France, Japan and South Korea to send warships to aid efforts to reopen the waterway as Iran restricted traffic in retaliation for the joint US-Israel strikes.
But as US allies hesitated to jump in, the former TV personality flipped the script from regime change to partnering with the new supreme leader, and first used the phrase “jointly controlled”.
“It will be jointly controlled ... Maybe by me. Me and the Ayatollah, whoever the next Ayatollah will be,” Trump said on March 23.
Since then, Trump has doubled down on the partnership concept, telling reporters that the US is “done policing the world for free” and that the Strait would become a “very profitable” operation.
Would China go along with a US-Iran joint venture?
But experts remained sceptical of Trump’s idea, given that the US leader swung from threatening to bring down Iranian civilisation to seeking a deal with Tehran almost overnight.
Rachel Ziemba, founder of advisory firm Ziemba Insights, called Trump’s proposal unrealistic, citing significant gaps that remained between the two sides on a range of issues, including sanctions relief.
The divisions meant that “the US is unlikely to deploy resources long-term to fortify and build up the transit route and regional and global actors will be hesitant to support this,” said Ziemba, also an adjunct senior fellow at the Centre for a New American Security.
“The US may try to extract rents through other channels like investment and purchase pledges from Gulf countries, but a formal bilateral fee structure seems unlikely,” Ziemba added.
Ziemba predicted China would likely favour free, predictable passage, and would prefer a regional framework to a venture between Washington and Tehran.
China gets roughly 40-50 per cent of its oil from the Strait.
Earlier reports suggested that Iran and Oman were planning to split fees in the strategic waterway.
Asked on Wednesday about Iran and Oman’s plans, China’s foreign ministry spokeswoman Mao Ning noted the critical importance of the trading route, adding that “keeping the area safe and stable and ensuring unimpeded passage serves the common interest of the international community”.
Melanie Sisson of the Brookings Institution called the idea of a joint toll system “surprising, to say the least”.
“[The proposal] is emblematic of the president’s belief that everyone in the world values money just as much as he does,” she said.
Sisson questioned the strategic logic for Tehran, saying she didn’t see why Iran would entertain an option that “would deprive it of its best leverage”.
“Making this arrangement would essentially eliminate its ability to deter attacks or negotiate conflicts of interest from a position of any strength in the future,” she added.
The joint venture would also set a “terrible precedent”, according to Sisson, essentially normalising the seizure of territorial control through military aggression in a waterway with global implications.
Regarding the impact on China, Sisson noted the war has already affirmed Beijing’s push towards broader self-reliance. “I have to assume Beijing will object forcefully to the joint toll proposition,” she concluded.
Mark Cancian of the Centre for Strategic and International Studies, a think tank in Washington, said it is hard to believe that the oil exporters in the Gulf or oil importers around the world would accept such a scheme.
“In effect, the United States and Iran would be taxing the oil shipments, not on the basis of any legal authority, but because they have the guns,” he said.
“There would need to be some enforcement mechanism. Iran might provide that but then it might decide to take all the revenue.”
In the long term, Cancian said it would push the Gulf states to build more pipelines because “they cannot be charged tolls by Iran or the United States”. -- SOUTH CHINA MORNING POST
