Treasury Secretary Scott Bessent made a dramatic policy announcement Thursday, revealing that the Trump administration is considering temporarily waiving sanctions on Iranian crude oil floating on tankers in international waters. The goal, Bessent said, is to quickly boost global oil supply and push back against the price surge caused by Iran’s closure of the Strait of Hormuz.
The Hormuz closure has created one of the most acute oil supply disruptions in recent years, with estimates suggesting the blockade removes between 10 and 14 million barrels per day from global markets. Crude prices have risen above $100 per barrel and held there for nearly two weeks, creating broad economic pressure across the world.
Bessent identified approximately 140 million barrels of Iranian crude on tankers — oil that had been heading to Chinese buyers — as a potential emergency supply source. If sanctions are temporarily lifted, this oil could be redirected to global markets, providing an estimated 10 to 14 days of supply relief while US diplomatic and military efforts continue.
The Treasury earlier used a similar mechanism for Russian oil, which helped add approximately 130 million barrels to world supply. Bessent also confirmed a unilateral US Strategic Petroleum Reserve release beyond the G7’s 400 million barrel coordinated commitment is being prepared, with a firm commitment to avoid any intervention in financial oil markets.
Independent experts were quick to flag risks. Compliance professionals and national security analysts warned that allowing Iran to sell its oil — even stranded oil under a narrow waiver — would funnel revenue to the Iranian regime, potentially financing military operations and support for proxy groups. Critics called the plan strategically contradictory and questioned whether its brief market benefit could justify the resulting financial windfall for Tehran.
