US Pauses Sanctions on Iranian Oil Already at Sea to Ease Supply Crisis

Mar 25, 2026

Treasury Secretary Scott Bessent announced the US will temporarily allow the sale of Iranian oil shipments already in transit, estimated to add 140 million barrels to the market. The move comes as oil prices hit their highest settlement since July 2022 amid Iran's closure of the Strait of Hormuz during the ongoing US-Israeli conflict with Iran.

US sanctions waiver on Iranian oil shipments

▪The US has not meaningfully imported Iranian oil since Washington imposed measures after the 1979 revolution.
▪The Trump administration waived sanctions on Iranian oil purchases at sea for 30 days.
▪The US issued a general licence on Friday allowing the sale of Iranian crude oil and petroleum products loaded on vessels as of Friday to 19 April.
▪Cuba, North Korea and Crimea are among the regions excluded from the Iranian oil sanctions waiver license.

Impact on global oil markets and supply pressures

▪US energy secretary Chris Wright said Iranian oil would hit the market after being refined over the next month and a half.
▪Japan gets about 90% of its oil shipments via the strait of Hormuz.
▪Oil prices were up about 50% to more than $100 a barrel, the highest since 2022.
▪Iran has effectively closed the strait of Hormuz, a conduit for about 20% of the world's oil and liquefied natural gas.
▪US energy secretary Chris Wright said Iranian oil supplies could reach Asia within three or four days.
▪US treasury secretary Scott Bessent said the Iranian oil waiver would bring about 140 million barrels of oil to global markets.
▪Japan depends on the Middle East for about 95% of its oil supplies.

Strategic and political implications of the policy shift

▪The White House is concerned that soaring oil prices will hurt US businesses and consumers ahead of the November midterm elections.
▪Scott Bessent said Iran will have difficulty accessing any revenue generated from the oil sales.
▪The Iranian oil sanctions waiver is expected to benefit China, the top buyer of Iranian oil.
▪Iran's foreign minister Abbas Araqchi told a Japanese news agency Tehran had started talks with Tokyo about possibly opening the strait of Hormuz to allow the passage of Japanese-related vessels.
▪Scott Bessent's earlier suggestion of a waiver raised concerns that it could benefit Iran's war effort.
▪Republicans hope to retain control of Congress in the November midterm elections.
▪Brent Erickson said the administration's efforts to control oil prices would not have a meaningful impact until the strait of Hormuz is opened to vessels.
▪Scott Bessent said the Iranian oil authorization is strictly limited to oil that is already in transit and does not allow new purchases or production.