The Trump administration is temporarily lifting longstanding sanctions banning the “sale, delivery, or offloading of crude oil or petroleum products of Iranian origin” for the next month in hopes of curbing the meteoric rise in oil prices that has threatened economies across the globe since the start of the U.S.-Israeli war against Iran last month.
A “General License” issued by the Treasury Department’s Office of Foreign Assets Control released late Friday permits the purchase of Iranian oil that has already been loaded onto “any vessel” — including ships that have already been sanctioned — by waiving ten separate sets of sanctions that have targeted both Russian and Iranian oil.
The sanctions that are being temporarily set aside have been in place for years, with many originating during Trump’s first term.
They were imposed to punish Russia for its unprovoked 2022 invasion of Ukraine and other “harmful foreign activities” and to penalize Iran for years of malign activities, human rights violations, support for terrorism and pursuit of weapons of mass destruction.
By waiving the sanctions, the U.S. will allow Iranian and Russian oil that is currently at sea to be purchased and unloaded without penalty until April 19, at which point the sanctions will resume unless the Treasury extends the waiver.
In a post on X announcing the decision, Treasury Secretary Scott Bessent defended it as a “narrowly tailored, short-term authorization” that applies only to Iranian petroleum that is “currently stranded at sea.”
He claimed the sanctions have permitted China to “hoard” Iranian oil “on the cheap” while also suggesting that temporarily relaxing sanctions would inject approximately 140 million barrels into global markets, thereby “expanding the amount of worldwide energy” and relieving what he described as “temporary pressures on supply caused by Iran.”
“In essence, we will be using the Iranian barrels against Tehran to keep the price down as we continue Operation Epic Fury,” Bessent said.
The Treasury Secretary added that the “temporary, short-term authorization” permitted by his department was limited only to “oil that is already in transit” and would not apply to any new production.
He also claimed that Tehran won’t easily benefit from the sanctions relief because of separate longstanding sanctions cutting off Iranian banks from the global financial system as part of the Trump administration’s “maximum pressure” campaign against the country’s Islamic Republic regime.
Bessent’s announcement comes after days of turmoil in world markets caused by escalating attacks on energy facilities across the Middle East coming from both sides of the war.
The price of Brent crude climbed as high as $119 per barrel and European gas prices briefly surged by 35 per cent on Friday after Iran pounded Qatar’s Ras Laffan energy hub and other Middle Eastern oil and gas infrastructure with missiles.
The Iranian attacks on Qatar came in response to an Israeli strike on the vital South Pars gas field, which drew condemnation from the Gulf states as well as Tehran.
In response, Iranian forces fired missiles at multiple energy sites across the Gulf, including a Saudi oil refinery, Qatari gas facilities and two more oil refineries in Kuwait.
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