Treasury Secretary Scott Bessent stepped into the heart of the global oil price debate Thursday, revealing that the United States could soon lift sanctions on Iranian oil sitting on tankers in international waters. The announcement came as oil prices have spent nearly two weeks above $100 per barrel, driven by Iran’s closure of the Strait of Hormuz shipping lane.
Iran’s decision to block the Strait of Hormuz has disrupted the daily transit of between 10 and 14 million barrels of oil, triggering one of the sharpest short-term supply shocks in recent global energy history. The economic consequences have spread rapidly, affecting fuel costs, trade, and consumer prices in countries that depend on imports flowing through the strait.
Bessent said approximately 140 million barrels of Iranian crude are currently on tankers that had been sailing toward Chinese ports. He described a possible temporary sanctions waiver as a way to redirect this oil to global markets, providing what he estimated would be approximately two weeks of supply relief while the administration’s broader campaign against Iran continues.
The approach mirrors an earlier waiver for Russian oil stranded on tankers, which reportedly added around 130 million barrels to world supply. Bessent also confirmed that the US will unilaterally release additional oil from its Strategic Petroleum Reserve, beyond the joint G7 commitment of 400 million barrels, while staying out of financial oil market instruments.
Critics from the policy and compliance communities were direct in their opposition. Experts pointed out that allowing any Iranian oil sales to proceed — even within a narrow waiver framework — would provide revenues to the Tehran government, which could be applied toward military activities and regional proxy forces. Several observers described the plan as strategically inconsistent and unlikely to produce lasting market stability.