TODAY: Iran’s toll play for Hormuz passage relies on loopholes

Good morning, wonderful people. It’s a brisk read this morning — but today we ask one important question: Is Iran allowed under international law to charge tolls for passage through the Strait of Hormuz?

Also in today’s issue, we take a look at how disruptions to flows in Hormuz introduced a risk regulators never planned for: conventional marine fuel may simply be unavailable as domestic demand takes priority — which can fundamentally reshape how we think about the transition to clean shipping.

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ENERGY — Kuwait Petroleum has declared force majeure on crude oil and refined product shipments, invoking the contractual clause after the Hormuz blockade made it impossible to fulfill delivery obligations to customers unable to access the Arabian Gulf, Bloomberg reports. The move signals mounting supply disruptions from the chokepoint’s closure, though a person with knowledge of the matter told the business information service that shipments won’t come to a complete halt.

RAIL — Saudi Arabia and Jordan will activate a joint committee to study a rail link that runs through Syria, calling for route option studies and technical alignments. The line would cover Jaber (Jordan-Syria) and Al Omari (Jordan-Saudi), plugging Jordan into a north-south freight spine.

BACKGROUND- The Kingdom already has 5.5k km of rail reaching the Jordanian border, Transport and Logistics Minister Saleh bin Nasser Al Jasser said, making this an extension play. The rail push also follows a 1.7k km Saudi freight corridor already linking King Abdulaziz Port, King Fahd Industrial Port, and Jubail Commercial Port to Al Haditha Port on the border with Jordan — already building on the southern leg.

Why this matters: Saudi is stacking routing alternatives in multiple directions as risk reshapes trade flows. “In an interconnected world, resilience is not a luxury; it is the entry ticket to lasting growth,” Wolfgang Lehmacher, former head of supply chain and transport industries at the World Economic Forum, previously told EnterpriseAM.

Market watch

Oil prices dropped this morning as expectations of upcoming US-Iran talks renewed hopes for increased Middle Eastern oil supply, Reuters reports. Brent crude futures slipped USD 0.54 to trade at USD 94.94 / bbl by 03.00 GMT, while US West Texas Intermediate (WTI) dipped USD 1.11 to USD 88.50 / bbl.

The Baltic Index continues to rise: The Baltic Exchange’s dry bulk index — which tracks rates for the capesize, panamax, and supramax vessel segments — was up 2.6% to 2,633 points on Monday. The capesize jumped 4.2% to 4,300 points, while the panamax index rose 0.1% to 1,976. The smaller supramax edged up 0.5% to 1,422 points.

Data point

37.6% — that’s the increase in container volumes at Jeddah Islamic Port in the first half of April, with exports growing 37.6% y-o-y and imports up 51.2%, a Mawani spokesperson said on X.

Why it matters: The increase points to heavier reliance on Red Sea ports for trade and logistics flows amid Hormuz’s closure. The East-West pipeline depends this corridor to move crude and support exports of around 5 mn bbl / d. Saudi also launched its logistics corridors initiative to position Jeddah, Yanbu, and King Abdullah ports as fallback gateways for Gulf trade, alongside five new freight routes linking Red Sea ports to Arabian Gulf ports.

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