U.S. Treasury authorizes purchase of Iranian oil already at sea, exempting buyers from tight sanctions restricting Iran’s oil industry for years. Move aims to curb soaring prices amid U.S.’s war with Iran.
Sanctions license allows purchasing of oil loaded onto ships by 12:01 a.m. ET on Friday, lasting until April 19. Does not cover people in North Korea, Cuba, or Russia-occupied Ukraine parts.
Treasury Secretary Scott Bessent stated move could free up about 140 million barrels of oil, previously “hoarded by China on the cheap.”
“In essence,” said Bessent, “we will be using Iranian barrels against Tehran to keep prices down as we continue Operation Epic Fury, expanding worldwide energy and relieving temporary supply pressures caused by Iran.”
Bessent argued Iran won’t access much from sales proceeds, maintaining maximum pressure on Iran’s ability to use international financial system.
This move marks wartime easing of President Trump’s “maximum pressure” strategy against Iran, which includes heavy sanctions making it difficult for wide swathes of the Iranian economy, including energy industry, to function.
Last week, U.S. also approved purchase of Russian oil at sea for one month amid intense sanctions since Russia’s full-scale invasion of Ukraine.
Moves are controversial. Congressional Democrats have sharply criticized Trump administration for loosening sanctions on Russian oil, arguing decision could deliver windfall to Russian President Vladimir Putin and give him means to continue war in Ukraine.
Trump Administration grappling with surge in oil prices caused by Iran war. Ship traffic through Strait of Hormuz has slowed due to fear of Iranian attacks, making it difficult for major Arab oil producers to export petroleum. But Iran allows its own exports to pass through the Strait.
Sanction reprieves aimed at easing oil prices by temporarily boosting supply. Trump has tried other strategies, including releasing 172 million barrels from Strategic Petroleum Reserve and allowing foreign ships to move oil between U.S. ports. Prices remain near multiyear highs.