In a striking policy announcement, Treasury Secretary Scott Bessent said Thursday the United States may temporarily remove sanctions from Iranian oil stranded on tankers as a tool to counteract Iran’s economic strategy of blocking the Strait of Hormuz. The plan represents an unconventional effort to use an adversary’s own resources against its geopolitical objectives.
Oil prices have been a significant source of concern for the administration, having remained above $100 per barrel for close to two weeks following Iran’s decision to block the Strait of Hormuz. The blockade has removed between 10 and 14 million barrels per day from the global market, making it one of the largest sudden supply disruptions in recent history.
Bessent disclosed that approximately 140 million barrels of Iranian crude are sitting aboard tankers that had been destined for Chinese customers. Releasing this oil to global markets through a temporary sanctions waiver would, in the Treasury Secretary’s words, provide 10 to 14 days of price relief while the US continues its broader campaign against Iran.
The Treasury has precedent for this kind of action, having previously sanctioned a temporary waiver for Russian oil stranded at sea, which added around 130 million barrels to global supply. Bessent also confirmed plans for a unilateral US Strategic Petroleum Reserve release beyond the G7’s joint 400-million-barrel commitment, and ruled out any financial market intervention.
Independent analysts challenged both the logic and the wisdom of the proposal. Policy experts warned that any oil revenue reaching Tehran would directly finance the Iranian regime’s military and proxy activities, effectively subsidizing the very conflict the US is trying to end. Critics described the plan as a short-sighted measure that could create long-term strategic problems in exchange for temporary and modest price relief.