U.S. Treasury targets Iran's levers of control in Strait of Hormuz as blockade continues

The U.S. Treasury Department on Wednesday announced sanctions on two entities used by Iran to control traffic in the Strait of Hormuz, as Washington looks to ramp up economic pressure on Tehran.

The Treasury’s Office of Foreign Assets Control said in a statement that Iran’s Persian Gulf Marine Insurance Co. and the Hormuz Safe Marine Services Authority had been placed on the Specially Designated Nationals and Blocked Persons list for running “coercive ‘insurance’ schemes that extort international shipping.”

“These entities manufacture risk — including the threat of vessel seizures — and then charge commercial vessels for coverage against dangers created by the regime itself, generating revenue that sustains IRGC operations and Iran’s broader campaign of regional destabilization,” reads a State Department statement on the sanctions, referring to the Islamic Revolutionary Guard Corps.

The Foreign Assets Control office also designated eight companies that it said were part of Iran’s “shadow fleet” that transports sanctioned oil.

Iran established the Persian Gulf Marine Insurance Co. and the Hormuz Safe Marine Services Authority after its military announced the closure of the Strait of Hormuz, an important strategic waterway connecting the Persian Gulf and the Gulf of Oman.

According to Iranian authorities, commercial tankers seeking to transit the strait must work with both organizations to ensure safe travel. Shipping companies have reportedly paid millions in fees, likely in the form of cryptocurrency, to both entities.

The new sanctions complement the U.S. naval blockade of Iran, according to the Office of Foreign Assets Control, which seeks to place more economic pressure on Iran as the U.S. military continues bombarding Iranian military facilities.