Treasury Secretary Scott Bessent floated what some experts described as a radical market fix Thursday: temporarily lifting US sanctions on Iranian crude oil stranded on tankers in international waters to address the global oil supply crisis caused by Iran’s Hormuz blockade. Bessent said the measure would inject critical short-term supply into markets where prices have exceeded $100 per barrel for close to two weeks.
Iran’s Strait of Hormuz closure has removed between 10 and 14 million barrels of daily oil supply from global markets, creating one of the sharpest and most sustained supply shocks in recent energy history. The resulting price surge has affected economies across the globe and has placed intense pressure on the administration to find fast and effective emergency supply solutions.
Bessent confirmed that approximately 140 million barrels of Iranian crude are stranded on tankers in international waters, oil originally bound for Chinese buyers. A targeted temporary waiver could redirect this oil to global markets, providing roughly two weeks of price relief while US efforts to force Iran to reopen the strait continue.
The Treasury’s approach draws on a successful precedent from a waiver for Russian oil that added approximately 130 million barrels to world supply. A unilateral US Strategic Petroleum Reserve release beyond the G7’s 400 million barrel commitment is also in the pipeline, while the administration has maintained its strict opposition to financial market intervention.
Policy and compliance experts described the plan as radical and raised serious concerns about its strategic implications. They warned that any Iranian oil revenue, regardless of the waiver’s scope, would provide the Tehran government with funds to sustain military activities and support proxy operations. Critics argued that the radical nature of the fix reflects the severity of the crisis but warned that its long-term consequences for US Iran policy could be equally radical.