US-Iran Talks: US Warns Iran That Hormuz Toll Demand Could Derail Peace Deal; Here's Why

Amid the recent talks between Iran and the United States in Doha, Qatar; both sides uncovered the most sensitive ongoing issues that included the future of Strait Of Hormuz- Iran's frozen assets and regional security.

Although neither Washington nor Tehran announced any major breakthrough, reports suggest that discussions largely centred on Iran's proposal to charge tolls for ships passing through the strategic waterway. The issue has emerged as one of the biggest obstacles to a broader agreement between the two countries.

Strait of Hormuz Remains the Biggest Challenge

It is reported that US representatives Steve Witkoff and Jared Kushner told Iranian negotiators that imposing tolls on commercial shipping through the Strait of Hormuz could jeopardize the broader agreement being negotiated between the two countries.

Washington's message to Tehran, a US official told Axios, is to "think bigger."
The official said the economic benefits Iran could gain if US sanctions are lifted would be much greater than the revenue it could gain by charging ships to pass through the strait.
The United States believes that unrestricted oil exports and better trading opportunities would earn Iran far more than any plan to collect tolls.

Why Is the Strait of Hormuz So Important?

The Strait of Hormuz is one of the world's most strategic maritime trade routes.
This narrow waterway carries a large part of the world's daily crude oil and liquefied natural gas and is critical to international energy supplies.

Disruption of the strait can immediately affect global oil prices and cause energy security fears.

The route has been a flashpoint over the past weeks in a series of exchanges of fire between the US and Iran and alleged attacks on commercial vessels off the coast of Oman.

Iran Wants a Bigger Role

According to reports, Iran has proposed a new arrangement under which it and Oman would jointly administer the Strait of Hormuz.

Tehran has reportedly argued that after the current 60-day Memorandum of Understanding (MoU) expires, both countries should oversee shipping through the strait and collect passage fees from vessels.

The 60-day negotiation period began after the MoU was signed last month and is expected to conclude on August 18, by which time both countries hope to finalise a broader agreement.

Differences Over the Agreement

The negotiations have also pointed out discrepancies about the interpretation of the existing memorandum by both sides.

According to the US, any further arrangements concerning the Strait of Hormuz must have the consent of other Gulf states since the strait has regional and worldwide significance.
On the contrary, Iran has declared that the strait is part of its territorial waters and neighboring Gulf states can give their views on the matter, while the final decision must be made in Tehran.

This discrepancy continues to form an integral part of the current negotiations.
In addition to this, negotiators have addressed other significant matters, including the status of Iran's frozen foreign assets and the ceasefire situation in Lebanon.
Although there have been no details of the outcome of these negotiations, the aforementioned issues have become important parts of the agreement.

Next Round of Talks

Qatar's Foreign Ministry has confirmed that another round of indirect talks will be held after the funeral ceremonies for Iran's late Supreme Leader Ayatollah Ali Khamenei, who is scheduled to be buried on July 9.