US may remove sanctions on Iranian oil stranded in tankers, treasury secretary says

The US may soon remove sanctions on Iranian oil stranded on tankers at sea, the treasury secretary, Scott Bessent, said on Thursday as Washington seeks to curb prices soaring over Iran’s closure of the strait of Hormuz.
“In the coming days, we may un-sanction the Iranian oil that’s on the water. It’s about 140m barrels,” Bessent said during an appearance on Fox Business Network’s Mornings with Maria.
“That’s about 10 days to two weeks of supply that the Iranians had been pushing out that would have all gone to China,” he continued. “In essence, we will be using the Iranian barrels against the Iranians to keep the price down for the next 10 to 14 days as we continue this campaign.”
Oil prices have been above $100 per barrel for much of the past two weeks as Iran has closed the strait of Hormuz to shipping and attacked tankers.
The treasury recently took a similar step to temporarily allow the sale of sanctioned Russian oil stranded on tankers, which Bessent said added around 130m barrels to global supplies.
A source familiar with the treasury’s planning said that if the Trump administration eases sanctions on Iranian oil, one option would be a waiver similar to one used for Russian oil, allowing sales of crude already stranded at sea and confined to a narrow time frame.
“A potential waiver could accelerate the diversion of oil already destined for China into global markets more broadly, helping ensure adequate supply and blunting Iran’s leverage over the strait of Hormuz,” said the source, who was not authorized to speak publicly and spoke on condition of anonymity.
Bessent said the US would take other actions to increase oil supply, including a unilateral release of stocks from the Strategic Petroleum Reserve above last week’s coordinated joint G7 release of 400m barrels.
He said the treasury would “absolutely not” try to intervene in oil futures markets, but would take actions to increase physical supplies to try to make up for the 10m-14m barrel-per-day deficit caused by the closure of the strait of Hormuz.
“So, to be clear, we’re not intervening in the financial markets. We are supplying the physical markets,” Bessent said.
Experts said Bessent’s proposal would not have a long-term impact on oil prices, and could actually help Iran in its fight against the US.
“To put it mildly, this is bananas,” Blackstone Compliance Services’ David Tannenbaum told the BBC. “Essentially, we’re allowing Iran to sell oil, which could then be used to fund the war effort.”
“Iran will likely profit from these sales, thereby providing more money to fund its regime, the war and its proxies,” Capitol Peak Strategies founder Alex Zerden told the New York Times. “I don’t think this stopgap measure will provide the market with assurance.”