The comparison sounds tempting, but it collapses the moment law meets geography. The Strait of Hormuz is a natural waterway linking the Gulf to the Arabian Sea, while the Suez Canal is a man-made corridor that Egypt excavated, regulates, dredges, and prices. My view is simple: Egypt is charging for infrastructure; Iran is trying to monetize a chokepoint that international maritime law treats as a passage route for the world, not as a tollbooth for a single coastal state. That is why the two cases are not twins. They are opposites dressed in similar rhetoric.
That distinction matters more now because energy markets are already strained and legal ambiguity is becoming a weapon. The governing framework is UNCLOS, and the public treaty record sits in the UN Treaty Collection. The broad rule reflected in the law of the sea is that a natural strait used for international navigation cannot be closed, licensed, or taxed merely because one coastal state says so. A canal is different: it is engineered, administered, and serviced, so lawful dues are part of the bargain. That is the bright legal line this debate keeps blurring for political effect.
The law is clearer than the politics
The best concise summary of the current dispute comes from the Reuters explainer on Hormuz fees and the IMO’s warning. They capture the dominant legal view: Iran may charge for specific services rendered, such as pilotage or tug assistance, but not for passage itself. That is the difference between a service fee and a sovereignty tax. Once a coastal state can charge simply for permission to cross a natural strait, transit passage stops being a right and becomes a shakedown. The International Maritime Organization was right to call that a dangerous precedent, because every chokepoint state would immediately get the idea.
The scale of what is at stake makes the legal issue impossible to shrug off. Official EIA chokepoint data, the IEA market update, and a recent UNCTAD note all underline the same point: Hormuz is not just important; it is systemically important. Around 20 million barrels per day of crude and oil products moved through the strait in 2025, roughly a quarter of global seaborne oil trade. More than 110 bcm of LNG also passed through it, representing about one-fifth of global LNG trade, with about 93% of Qatar’s LNG exports and 96% of the UAE’s crossing that narrow lane.
Why Egypt’s case is stronger
Egypt’s legal position rests on the fact that the Suez is an artificial canal, not a natural strait. The Suez toll table and official Suez toll calculator are public because dues are part of a regularized commercial system, not an improvised geopolitical ultimatum. Ships are paying to use a maintained piece of infrastructure with dredging, traffic management, convoy scheduling, inspection rules, and canal administration. That is why Panama can do the same thing. Nobody seriously argues that a ship has a natural-law entitlement to use another state’s excavated shortcut for free. The fee is attached to the constructed asset and the services around it.
The statistics reinforce the point. According to the official Suez 2025 traffic report, the canal handled 12,758 vessels and 522.1 million net tons in 2025. LNG ship tonnage jumped 132.4% and car carriers 74.4%, even while total vessel numbers were down 3.4% from 2024. Yet Egypt’s canal finances were still battered by regional insecurity: Reuters on Suez revenue losses reported monthly losses of about $800 million, and Reuters on Suez discounts said quarterly revenue had plunged to $880.9 million from $2.40 billion a year earlier. Egypt is charging lawful dues on infrastructure it also must keep commercially viable.
Iran’s demand is legally weak but strategically potent
Iran’s problem is that it is trying to convert coercive leverage into legal entitlement. Yes, a few tankers have started moving again, as Reuters on resumed tanker transits reported, but the broader dispute is unresolved. Reuters on Trump’s position shows Washington making free passage a red line, while Reuters on the UAE position makes clear Gulf states do not accept the strait being “held hostage.” Qatar’s stake is obvious from Reuters on Qatar LNG disruption, and the latest AP report on the talks shows how central Hormuz has become to ceasefire diplomacy. Some reporting has even described a proposed roughly $1-per-barrel, crypto-linked toll mechanism, although Reuters has so far confirmed only a variable fee structure tied to ship and cargo type. Legally, that is shaky. Politically, it is powerful because the world has not found an easy way to force reality back into line with doctrine.
The final irony is that the comparison Iran wants is the one that defeats its case. The Panama Canal tariff list shows what a lawful canal-fee regime looks like: published tariffs, known services, predictable administration, and an artificial waterway under canal authority control. Hormuz is nothing like that. It is a natural strait whose openness underwrites world commerce. So, the legal verdict is not especially mysterious. Egypt can charge because Suez is infrastructure. Iran’s claim is controversial because Hormuz is geography. The real danger is that law may be clear while enforcement is not, and that gap is where energy crises, naval brinkmanship, and great-power bargaining begin.
