Chinese Payment Stocks Rally as Iran Accepts Yuan for Strait of Hormuz Tolls

Yuan Payments at Hormuz Lift Chinese Financial Shares

Chinese payment and financial services stocks surged in the week leading up to April 12, 2026, as the use of yuan to pay Iranian transit fees through the Strait of Hormuz gave investors a concrete example of China's currency gaining a role in a major global trade corridor. Fees for individual vessels can reach $2 million at a waterway that normally carries roughly 20% of globally traded oil and natural gas.

CNPC Capital Co, the financial services unit of China National Petroleum Corp, rose by as much as the 10% daily limit on the Shenzhen exchange. Lakala Payment Co, a major provider of payments services, climbed as much as 7.9%. Financial technology company Shenzhen Forms Syntron Information Co gained 9.4% before surrendering some of its advance.

The rally followed a notice on China's Ministry of Commerce website citing shipping industry reporting that vessels were paying Iran for passage and that Chinese currency was accepted. China has promoted wider international use of the yuan for years. Investors treated its practical use at Hormuz as the kind of concrete development they had been waiting for.

Shen Meng, a director at Beijing investment bank Chanson & Co, linked the stock market response to China's relationship with Iran and the search for alternatives to established payment channels.

As the Iran war continues, the yuan is emerging as a key alternative for global capital due to China's good relationship with Iran. Thus, related sectors such as oil and gas capital companies and electronic payment stocks will receive more capital flows.

Shen also identified China's campaign to internationalize the yuan as a driver of its use in Hormuz. For investors, that connected a currency policy pursued over many years with immediate demand for financial services during the conflict.

How Iran's Passage System Works

Iran has effectively established a formal toll collection system in the strait, using its control over passage to collect revenue. The Islamic Revolutionary Guard Corps, or IRGC, administers the arrangement through intermediaries linked to the force. Countries receive a friendliness ranking from one to five, making political relationships part of the clearance process.

Ship operators seeking permission must submit vessel ownership records, flag registration, cargo manifests, destination ports, crew lists and Automatic Identification System tracking data. That tracking information records a vessel's identity and movements, while the other documents show who controls the ship, what it carries and where it is going.

The IRGC Navy's Hormozgan Provincial Command then screens the application for sanctions issues and checks ownership or cargo connections to the United States, Israel or countries classified as adversaries. Approved vessels receive a passcode to broadcast over VHF radio and are then given a naval escort through the strait.

Oil tankers face opening fees of approximately $1 per barrel. A Very Large Crude Carrier, known as a VLCC, typically holds 2 million barrels, putting the charge for a full vessel at about $2 million. The structure ties the potential payment to the amount of oil aboard.

Iran's arrangement combines financial collection with decisions about access. Operators need more than the ability to pay: they must also pass checks involving their vessel, cargo and national connections. That gives Tehran influence over which ships move as well as the price of their passage.

Alliances Shape Who Gets Through

Iran has indicated that vessels associated with India, China, Russia, Pakistan and Iraq can receive preferential treatment or exemptions. Ships connected to the United States, Israel and their allies face denial of passage or higher charges. A vessel's national ties therefore affect both access and cost.

Pakistan's experience shows how those preferences can influence shipping arrangements. Iran agreed to allow 20 Pakistani vessels through the strait, but Pakistan had only a few ships flying its flag in the Gulf. Islamabad subsequently approached major commodity traders to ask whether they had vessels that could temporarily operate under Pakistani flags and qualify for the arrangement.

India has also received public reassurance. The Iranian Embassy in New Delhi posted on X that Indian friends were in safe hands, accompanying the message with a wink emoji. Several vessels flying India's flag have already passed through after coordination with Iranian authorities.

India's position as one of the world's largest oil importers makes access especially consequential. The exemptions and assurances also show how Iran is using passage through the strait to reward countries it considers friendly while restricting those it regards as hostile.

Yuan and Digital Assets Enter the Payment System

Chinese currency is one part of a broader payment structure designed to operate outside traditional financial channels. Yuan settlement can avoid dollar clearing, the process through which payments in dollars are completed. The arrangement described at Hormuz also avoids dependence on the SWIFT messaging network used for international banking instructions.

Iran has also accepted cryptocurrency payments, including stablecoins pegged to conventional currencies. Bitcoin has been mentioned as another possible payment method, although its use is less firmly described than yuan settlement or stablecoin payments.

Stablecoins appeal to recipients because they are designed to keep a steady value against the currency they track. Bitcoin and Ethereum can move sharply in price between the moment an invoice is issued and the moment payment arrives. A stablecoin linked to the dollar aims to reduce that problem, making the payment function more like a dollar transfer while remaining outside conventional dollar clearing.

These channels create pressure on major stablecoin issuers, including Tether and Circle. The US Office of Foreign Assets Control, or OFAC, has been trying to close routes used to evade sanctions through regulatory pressure. The use of digital assets for transit payments brings that enforcement effort directly into the shipping dispute.

Wang Yiwei, director of the Institute of International Affairs at Renmin University, has proposed extending the payment model. His suggestions include tying tolls and settlement to oil prices or using digital tokens that China could export. He described innovative settlement mechanisms coordinating computing power, oil, dollars and security.

Why the Charges Face Legal Challenges

The Strait of Hormuz is an international strait under the United Nations Convention on the Law of the Sea, known as UNCLOS. The convention protects transit passage through such waterways and prohibits fees charged merely for navigating them. Iran's demand for payment therefore faces a direct challenge under international maritime law.

Article 17 of the convention also guarantees innocent passage for ships that do not threaten coastal states. Innocent passage and transit passage are related protections for navigation, with transit passage addressing travel through international straits. The central issue at Hormuz is whether Iran can make ordinary passage conditional on payment and political approval.

Philippe Delebecque, a professor and maritime law specialist at the Sorbonne University in Paris, described freedom of navigation as the starting principle.

Freedom of navigation has always been recognised, including specifically in straits. The sea doesn't belong to anyone.

Neither Iran nor the United States has ratified UNCLOS, although 172 countries have. Legal experts say customary international law still applies to countries outside the convention. Those are international rules arising from established state practice and accepted legal obligations.

Julien Raynaut, who heads the French Association of Maritime Law, warned that accepting an Iranian tollbooth could encourage restrictions elsewhere. He pointed to the possibility of China concluding that it could restrict movement through the Taiwan Strait, or other countries blocking the Strait of Gibraltar or the Strait of Malacca.

Those comparisons put the dispute beyond a single payment demand. The legal concern is that control of a narrow waterway could become a basis for charging ships or deciding which countries are entitled to use a route serving international trade.

What the Tolls Could Earn Iran

Before the conflict, approximately 53 tankers arrived daily carrying about 21.5 million barrels of oil. Applying a fee of $1 to each barrel produces a potential daily intake of $21.5 million. The corresponding annual estimate is approximately $7.74 billion, assuming traffic resumes at that scale.

Iran's recent annual oil export revenue has been roughly $50 billion to $55 billion. Even the projected toll income at normal traffic levels would be well below those export earnings, though it would create a substantial additional source of money tied to the movement of other countries' cargoes.

Current conditions are far removed from those traffic assumptions. Shipping through the strait has fallen close to zero because of security concerns. Frontier Investments chief executive Louis LaValle estimated that Iran might nevertheless be collecting about $5 million a day in tolls, equivalent to roughly $150 million a month.

LaValle's estimate concerns possible current collections, while the larger projection depends on the return of much heavier traffic. The difference makes the volume of ships willing and able to transit central to Iran's potential earnings.

Rebecca Babin, senior energy trader at CIBC Private Wealth, described a toll structure as putting a straightjacket on flows. The payment and approval process can constrain the amount of oil moving through the strait even when operators are prepared to pay.

Oil Prices Reflect the Supply Squeeze

The disruption has reached the market for physical crude. S&P Global put the spot price of physical Brent cargoes at $141.36, its highest level since the 2008 financial crisis. The figure reflects the price of actual cargoes in a market facing tight supply after the disruption.

Transit charges are only one pressure on shipping. Despite a ceasefire between the United States and Iran, more than 800 vessels remain stranded in the Gulf. Insurance costs have surged, and military risks continue to affect decisions about whether ships can move.

A ceasefire therefore leaves a practical task for ship operators: arranging passage, obtaining insurance and assessing the danger to vessels and crews. The combination of security checks, charges and continuing military risk helps explain why the movement of cargo remains constrained.

US President Donald Trump has proposed establishing tolls as a joint venture between Washington and Tehran. White House officials later stated opposition to tolls controlled by Iran. Those positions leave the political handling of transit charges unsettled while shipping companies continue to face immediate operational decisions.

Why Yuan Settlement Matters to Dollar Dominance

About 80% of international oil transactions have been settled in dollars for decades. That pattern, commonly called the petrodollar system, supports American financial influence because so much energy trade depends on the US currency. Accepting yuan for passage through Hormuz introduces another currency into payments connected with a major energy route.

Iran has two connected incentives: obtaining money through channels less exposed to US sanctions and strengthening its relationship with China. Kenneth Rogoff, an economics professor at Harvard University and former chief economist at the International Monetary Fund, described those motivations.

At one level, Iran is aiming to poke its thumb in the United States's eye, adding insult to injury. At another level, Iran is dead serious about preferring yuan to avoid US sanctions and to cultivate its ally, China, which has been moving steadily to redenominate its own trade, and that of the BRICS nations into yuan.

Redenominating trade means changing the currency in which a transaction is priced or settled. At Hormuz, the immediate change concerns payment for transit. Its strategic value to Beijing lies in giving the yuan another practical use in international commerce.

Alicia Garcia-Herrero, chief economist for Asia Pacific at Natixis in Hong Kong, said the development adds incremental pressure on the dollar and makes alternative currencies more familiar in energy flows. She cautioned that a much wider move away from the dollar would require the participation of Gulf states.

Those states have priced oil in dollars since the 1970s, when Saudi Arabia agreed to exclusive dollar use in exchange for US security guarantees. Their role in producing and selling energy makes their currency choices central to any broader shift.

A Strategic Asset With an Unsettled Future

Dan Steinbock, founder of the consultancy Difference Group, expects dollar supremacy to hold in the short term. He sees the yuan's expanding use as a process that could gradually reduce American dominance in particular sectors, rather than replace the dollar abruptly.

China and Iran are seeking a financial system with more than one dominant centre. Hormuz gives that ambition a tangible setting: an essential shipping route where the currency accepted for access can be chosen outside the usual dollar payment structure.

Countries dependent on Gulf energy face competing pressures. They need passage for ships carrying vital supplies, while also considering possible backlash from Washington, which has shown a willingness to disrupt longstanding relationships. Iran's selective treatment adds another layer, since access can depend on a country's political relationship with Tehran.

The IRGC Navy has stated that the strait will never return to its former state, particularly regarding access for the United States and Israel. That position suggests Iran sees control over passage as a lasting strategic asset rather than simply a temporary wartime measure.

As of April 12, 2026, the durability of the toll arrangement was undecided. Its continuation depends on political pressure, legal challenges and the ability to restore shipping while military risks persist. For financial markets, the immediate development is yuan settlement at a critical trade route; for ship operators and energy buyers, the urgent concern remains getting cargo through.

Key Points

• CNPC Capital rose as much as 10%, Lakala Payment 7.9% and Shenzhen Forms Syntron Information 9.4% as investors responded to yuan payments for Hormuz transit.
• Iran's system uses IRGC intermediaries, country rankings, vessel documentation, radio passcodes and naval escorts to control passage.
• Opening fees of about $1 per barrel put the charge for a tanker carrying 2 million barrels at approximately $2 million.
• India, China, Russia, Pakistan and Iraq have been offered preferential treatment or exemptions, while vessels linked to US and Israeli interests face restrictions.
• Payments include yuan and stablecoins, with Bitcoin also mentioned, as Iran seeks channels outside conventional dollar clearing.
• The charges face challenges under international maritime law protecting navigation through international straits.
• Projected toll revenue at normal traffic levels is about $7.74 billion annually; possible current collections have been estimated at $150 million monthly.
• Physical Brent cargoes reached $141.36, while more than 800 vessels remained stranded in the Gulf despite a US-Iran ceasefire.
• Wider yuan use could gradually reduce dollar dependence in some transactions, while a broader currency shift would require participation from Gulf oil producers.