Intensely lobbying Trump, American oil giants do not want to see a "precedent of charging fees for the Strait of Hormuz."

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Executives in the U.S. oil industry have recently been intensively pressuring the Trump administration, demanding a clear rejection of any form of Strait transit fee arrangement in negotiations with Iran.

Recently, several industry executives directly told the media that the only way to resolve the current global energy crisis is to reopen the Strait of Hormuz—about one-fifth of the world’s crude oil and liquefied natural gas are transported through this passage.

Oil executives are scheduled to meet with Trump Thursday afternoon, with topics expected to cover freedom of navigation in the Strait and boosting oil production, among others.

Industry warning: Fees would set a dangerous precedent

The American Petroleum Institute (API), the largest industry lobbying group in the U.S., made a clear statement: “Imposing transit fees on this globally critical chokepoint would set a worrying precedent for international waterways and damage global energy markets.”

The core logic behind industry concerns is that if Iran successfully imposes fees on the Strait of Hormuz, other countries may follow suit and levy similar fees on strategic waterways under their control, thereby undermining the basic principle of global shipping freedom.

S&P Global Vice Chairman and author of “The Prize,” Daniel Yergin, said: “Turning the Strait of Hormuz into an Iranian canal is in itself extremely dangerous, and could also set a precedent that overturns the principle of freedom of the seas.”

Trump's wavering stance, White House ultimately takes hard line

Last week, Trump publicly hinted that the U.S. could cooperate with Iran to charge transit fees for passing ships, claiming there was “big money” to be made. This statement shocked many oil executives.

Afterward, Trump changed his tune on social media, saying Iran “better not” charge fees to passing oil tankers. The White House spokesperson later clarified: “As the president said, the Strait of Hormuz is international waters, and we will not allow Iran to charge fees for the Strait.”

Industry veteran: Use military force if necessary

Veteran U.S. oil industry leader Scott Sheffield used tough language. He said Trump must resolve the Strait issue to protect the world economy from the shock of soaring oil prices, “even if it means deploying U.S. military forces locally.”

Sheffield said, “It must be opened. Ultimately, it may be necessary to form a joint force with Europe, Asia, and other Persian Gulf countries to achieve this goal.”

Sultan al-Jaber, CEO of Abu Dhabi National Oil Company (ADNOC), also posted on social media Sunday: “The Strait of Hormuz has never been Iran’s to close or restrict. Setting such a precedent is illegal, dangerous, and unacceptable.”

Currently, the U.S. and Iran held talks last weekend in Islamabad, but signs of progress were scarce. Trump subsequently ordered the U.S. Navy to blockade the Strait, preventing ships from entering or leaving Iranian ports. A new round of negotiations is expected soon, with the transit fee issue set to be one of the core points of contention.

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