Iran’s envoy to China says Beijing to get Hormuz concessions

Iran’s ambassador to Beijing said China and other friendly nations will be granted “special considerations” when Tehran determines the level and nature of service fees charged to ships using the Strait of Hormuz.

Abdolreza Rahmani Fazli said the critical waterway for energy supplies is now a matter of “national security” in the aftermath of the four-month US and Israeli war on the Islamic republic. Thus, “there will be new arrangements concerning the Strait of Hormuz with the collaboration and cooperation of the state of Oman”, he said.

“We will definitely have special considerations for China, because China is a friendly country,” Fazli said on July 4 at the World Peace Forum in Beijing, without specifying what those concessions would entail.

“Special treatment we should award to countries which are friendly to us.”

The future management of the Strait of Hormuz is among several contentious issues being discussed as part of negotiations to secure a permanent end to the conflict. Iran effectively closed the strait when the US and Israel began air strikes in late February, with traffic only recently picking up following an interim peace deal signed in June.

At least eight ships attempting to leave the Persian Gulf along the Omani coast turned back between July 3 and July 4, in the latest sign that reopening the strait remains fraught with complexity.

The US and Gulf Arab countries insist that Iran and Oman cannot impose charges of any kind for the waterway. But some European nations now accept that ships transiting the chokepoint will have to pay some sort of fee, people familiar with the matter said on July 2. They have pressed Iranian and Omani officials not to discriminate against ships based on their nationality, the people said.

China, which buys almost all of Iran’s oil exports, on July 3 called for the unhindered flow of shipping through the Strait of Hormuz. That would be in the “interests of all parties”, Foreign Ministry spokesman Guo Jiakun said.

About a fifth of the world’s oil and liquefied natural gas supplies flowed through the strait before the conflict.

Iran’s ambassador to China said fees would be levied to guarantee the safe passage of ships through the strait, while also dealing with the cost of environmental consequences. Enforcement “will not go against the international laws of the sea”, Fazli said.

China has kept to the sidelines of the Iran war, calling for restraint while offering some diplomatic support mainly through its ally, Pakistan. It is seeking to protect shipping in the Gulf and prevent further energy supply disruptions, which could strain its domestic economy.

Still, China has cast itself as a stabilising force while questioning US primacy in the Middle East and reliability more broadly. BLOOMBERG