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Apr 29, 2026 Iran-Oman Strait of Hormuz Smuggler Trade Continues Amid US Blockade A long-standing trade involving Iranian-based traders crossing the Strait of Hormuz continues to operate, according to a report by The Maritime Executive published on April 28, 2026. These traders bring goods to Oman's Musandam governorate, barter with merchants in Khasab, and return with items in short supply in Iran.
While Omani authorities consider this trade legal, the Islamic Republic of Iran Customs Administration (IRICA) views it as illegal. To evade Iranian customs patrols, the traders cross the strait in the last hours of darkness, with sometimes as many as 500 powerful speedboats arriving in Khasab harbor shortly after dawn. The cargo varies by season, including items such as pistachio nuts, tomato puree, live sheep, and carpets. In exchange, Khasab merchants offer goods that command high prices in Iran, such as washing machines, Western brand cigarettes, and more recently, Starlink terminals. The boats wait for darkness before returning to avoid patrols.
IRICA agents and the IRGC Navy are not necessarily aligned on this activity. The IRGC Navy prefers to impose its own taxes on the trade or occasionally seize items like washing machines rather than halt it. The IRGC Navy has also been known to infiltrate its own craft among the trader speedboats for surveillance outside territorial waters, though Omani authorities are adept at identifying these infiltrators.
The financial volume of this trade is not large, and very little of it appears in Iranian trade statistics. Halting it would have no national-level economic impact on Iran's IRGC-dominated government, but the trade is economically important locally in Oman's Musandam and Iran's Hormozgan Province.
Since the start of the war on February 28, this smuggler trade has barely faltered. It has not been affected by the US-imposed blockade on Iranian ships and ports, as the trader boats are technically neither ships nor using Iranian ports. This presents a problem, as the boats—or similar-looking craft—could be used by the IRGC Navy as platforms for attacks with small arms, rocket-propelled grenades, and limpet mines. Larger Iranian Maham-3 mines come with a wheeled dispenser for launching from minimally modified speedboats, while the smaller Maham-7 acoustic mine is even easier to deploy.
For now, the US blockade does not need to operate close to the strait to be effective; high-value ships and cargo can be intercepted deep into the Arabian and Indian Oceans, applying gradual economic pressure. Closing down small-boat trader traffic will not increase or speed up this pressure. However, if a serious mine-clearance operation and escorted convoys through the strait are introduced, the profusion of small speedboats crossing the strait would need to be addressed.
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