Iranian officials are in negotiations with members of the Gulf Cooperation Council (GCC) about creating a system to charge fees for ships transiting the Strait of Hormuz. 

According to the Wall Street Journal, Iran is seeking to impose a toll on vessels entering and exiting the Persian Gulf similar to how Turkey taxes ships transiting the Dardanelles. China is involved in the talks. 

On Thursday, Secretary of State Marco Rubio claimed that GCC states would not make a deal that allowed Iran to charge shipping fees. Additionally, the State Department issued a joint statement with the GCC Foreign Ministries, which said that the countries rejected any fees in the Strait. 

The Strait of Hormuz has become one of the central issues in negotiations to end the war against Iran. Before the conflict, ships were able to safely transit the Strait of Hormuz. In response to the US-Israel war, Iran seized control of the waterway. 

Tehran says any agreement ending the war must recognize that the Strait is part of Iran’s and Oman’s territorial waters, allowing Iran to levy fees. At its narrowest point, the waterway is just 21 miles wide.

President Donald Trump has stated that any peace deal must include the Strait of Hormuz returning to its prewar status. On Wednesday, Oman announced that it had opened a shipping line outside of Iran’s control. 

The IRGC warned that commercial vessels must use shipping routes approved by Tehran. On Thursday, a ship was reportedly hit by a projectile near Oman. 

According to the WSJ, Tehran believes it will generate $40 billion in revenue from ships paying fees for transiting the Strait. The Strait of Hormuz is the only entry and exit from the Persian Gulf. A fifth of global oil crosses the Strait.