The possibility that the United States might temporarily waive sanctions on Iranian oil caught global attention Thursday after Treasury Secretary Scott Bessent made the announcement on national television. Bessent pitched the idea as a pragmatic response to the supply shock created by Iran’s blockade of the Strait of Hormuz, which has kept oil prices above $100 per barrel for nearly two weeks.
The strait’s closure has disrupted the daily flow of up to 14 million barrels of oil, creating a significant gap between global supply and demand. The economic consequences have been felt worldwide, with energy costs rising sharply across transportation, manufacturing, and consumer sectors in oil-dependent economies.
Bessent pointed to roughly 140 million barrels of Iranian crude stranded on tankers as an untapped buffer supply. He argued that temporarily removing sanctions and allowing this oil to enter global markets would provide approximately two weeks of relief, a window the administration believes is sufficient for its ongoing campaign to have a meaningful impact on the situation.
Drawing on recent precedent, the Treasury previously enabled the sale of sanctioned Russian crude stranded at sea, a move that added approximately 130 million barrels to global supply. A further boost from a unilateral US Strategic Petroleum Reserve drawdown is also planned, supplementing the 400 million barrel joint release already agreed with G7 partners.
Expert opinion on the proposal was sharply divided. While the administration argued the move was purely tactical, critics from the sanctions compliance world warned that it would provide Tehran with money to fund military and proxy activities. Some described the measure as fundamentally counterproductive and warned that any market reassurance it provides will be shallow and short-lived.