Treasury Secretary Scott Bessent revealed Thursday that the administration is considering an unprecedented step: temporarily freeing Iranian crude oil stranded on tankers for global sale by lifting existing sanctions. The potential measure is part of Washington’s emergency supply strategy to address oil prices above $100 per barrel caused by Iran’s closure of the Strait of Hormuz.
Iran’s Hormuz blockade has created a daily supply shortfall of between 10 and 14 million barrels, one of the most significant disruptions to global oil supply in recent years. The sustained price surge has had broad economic consequences and has forced the administration to consider supply-side measures of increasing scale and ambition.
Bessent confirmed that approximately 140 million barrels of Iranian crude are stranded on tankers in international waters, oil originally destined for Chinese buyers. A targeted temporary sanctions waiver could redirect this oil to global markets, providing an estimated two-week supply bridge during the US campaign to resolve the Hormuz crisis.
The plan draws on a precedent set by a Treasury waiver for Russian oil that contributed approximately 130 million barrels to world supply. An additional unilateral US Strategic Petroleum Reserve release beyond the G7’s 400 million barrel coordinated commitment is also being planned, with the administration ruling out any engagement in financial oil market instruments.
Analysts and sanctions experts described the potential measure as unprecedented and raised serious concerns about its strategic implications. They argued that allowing Iranian oil revenues, regardless of the waiver’s narrow scope, would provide the Tehran regime with funds for military activities and proxy support. Critics warned that freeing Iranian crude for global sale, even temporarily, sets a precedent that could weaken the broader US Iran sanctions regime in ways that outlast the current crisis.