Treasury Secretary Scott Bessent made a surprising policy disclosure Thursday, saying the United States may move to lift sanctions on Iranian crude oil stranded on tankers as a way to bridge the global oil supply gap created by Iran’s Strait of Hormuz closure. The announcement has drawn both interest and criticism from the energy and policy communities.
For nearly two weeks, Iran’s Hormuz blockade has removed between 10 and 14 million barrels of oil per day from global markets, causing crude prices to surge above $100 per barrel. The sustained disruption has created significant economic challenges for oil-importing countries and has put pressure on the administration to find fast and effective supply-side solutions.
Bessent said around 140 million barrels of Iranian oil are currently floating on tankers in international waters, oil that had been on its way to Chinese buyers. He outlined a potential temporary sanctions waiver that could redirect this oil to global markets and provide an estimated two-week supply buffer as the US campaign against the Hormuz blockade develops.
The Treasury has previously issued similar waivers, including for Russian oil stranded at sea, which contributed approximately 130 million barrels to world supply. Additional supply from a unilateral US Strategic Petroleum Reserve release, beyond the G7’s 400 million barrel joint commitment, is also being prepared, while the administration maintains its stance against financial market intervention.
Experts in national security and sanctions law were skeptical. They argued that any revenue from Iranian oil sales, however narrowly the waiver is constructed, would benefit the Iranian government, potentially funding military activities and proxy operations. Critics warned that the plan’s short-term market benefit could come with a long-term strategic cost that significantly outweighs the price relief achieved.