The Wall Street Journal reports:

Oil tankers, container ships and bulk carriers shimmer all over the horizon to the left of the windswept beach here at the entrance to the Strait of Hormuz. They have been bottled up in the Persian Gulf ever since the U.S. and Israel launched the war on Iran more than a month ago.

To the right, with the Iranian coast only 40 miles away, the dark-blue sea is completely empty. Only a handful of vessels a day manage to cross the Strait of Hormuz, down from well over 100 before the war. They take a circuitous route through Iranian territorial waters, often paying the Iranian regime a hefty toll.

Tehran’s ability to control this international waterway, through which one-fifth of the worldwide oil supply used to pass, has become Iran’s biggest leverage against the U.S., its Gulf neighbors and the global economy. Whether the war ends in a success or defeat for Iran depends first and foremost on whether Tehran emerges from this conflict still holding the strait—and, with it, the keys to the worldwide energy markets.

“To the Iranians, the Strait of Hormuz now matters more than the nuclear program. The nuclear program was symbolic, but didn’t provide them with any deterrence,” said Vali Nasr, a professor at Johns Hopkins University and former senior State Department official who has been involved in informal discussions with Iranian representatives. “Now, the only reason why they are surviving this war is because of the strait. The Iranian thinking is that, at the end, the strait must remain under their control because it is their only deterrence and only source of revenue.”

Indeed, the Iranian regime has announced very ambitious plans for the Strait of Hormuz. The Iranian Parliament’s national-security commission has already advanced new legislation that would require passing vessels to pay for the privilege, and that would bar from the Persian Gulf any non-friendly countries. This is a lever through which Tehran hopes to force European nations, Japan and others to drop economic sanctions against it—while also permanently expelling the U.S. Navy from the Gulf’s waters.

“Trump has finally achieved his dream of regime change—but in the region’s maritime regime. The Strait of Hormuz will certainly reopen, but not for you: It will be open for those who comply with the new laws of Iran,” said the parliament commission’s chief, Ebrahim Azizi.

While Iranian officials compare the proposed toll system to the practice of the Suez Canal, which generates billions of dollars each year for Egypt, these two waterways are fundamentally different under international law. The Strait of Hormuz is a natural passage, not a man-made canal running through sovereign territory. Iran owns only one shore—with Oman’s Musandam exclave sitting on the other.

“There is no conceivable legal argument for why Iran would be able to regulate commercial shipping on Oman’s side of the maritime boundary,” said James D. Fry, an expert on international maritime law and professor at the University of Hong Kong Faculty of Law. [Continue reading…]