In an unexpected twist in the ongoing standoff over Iran’s Strait of Hormuz closure, Treasury Secretary Scott Bessent revealed Thursday that the US may soon allow the sale of Iranian oil currently held on tankers at sea. The announcement reflects Washington’s growing urgency to address oil prices that have remained above $100 per barrel for nearly two weeks.
Bessent described the oil in question — approximately 140 million barrels aboard tankers that were destined for China — as a ready-made reserve that could be unlocked to provide global markets with temporary relief. He said the supply represented roughly two weeks of buffer against the shortfall caused by Iran’s blockade of the Strait of Hormuz, one of the world’s most critical oil shipping chokepoints.
This approach follows a precedent set by the Treasury earlier in the crisis, when a targeted waiver allowed sanctioned Russian oil stranded on tankers to be sold, adding around 130 million barrels to global supply. A senior government source said a similar, narrowly defined waiver for Iranian oil is among the options being actively considered, designed to allow diverted oil sales without permanently weakening the broader sanctions framework.
Bessent also addressed what the administration would not do, making clear that direct intervention in oil futures markets was off the table. Instead, the focus remains on physical oil supply, supplemented by a unilateral release from the US Strategic Petroleum Reserve beyond what G7 members have already jointly committed.
Despite the administration’s optimism, energy policy experts and compliance professionals raised red flags. They warned that any monetary benefit from oil sales flowing to Tehran would directly contradict US efforts to economically isolate the Iranian government, and that the measure’s market impact would be short-lived, potentially leaving the US having granted a significant concession for minimal long-term gain.