The US Treasury Department issued a temporary authorization Friday permitting the sale of Iranian oil stranded at sea, according to Treasury Secretary Scott Bessent.
The "narrowly tailored" license, which runs until April 19, covers Iranian crude oil and petroleum products already loaded on vessels as of March 20, including those on previously sanctioned ships. Related services such as crew management, insurance and docking are also permitted under the authorization.
Bessent said sanctioned Iranian oil was being "hoarded" by China at discounted prices, and unlocking the supply would bring approximately 140 million barrels to global markets.
"We will be using the Iranian barrels against Tehran to keep the price down," he said.
The short-term authorization is "strictly limited to oil that is already in transit and does not allow new purchases or production," he said, framing the move as a way to relieve temporary supply pressures caused by the war with Iran.
Bessent added that Iran would have difficulty accessing any revenue generated from the sales, saying the US would "continue to maintain maximum pressure on Iran and its ability to access the international financial system."
Oil prices rose amid escalating regional tensions, with Brent crude climbing about 4% to $112.4, while West Texas Intermediate reached $98.35 per barrel, up 2.8%.
The conflict involving Iran has disrupted maritime traffic through the strategic waterway, with reports of hundreds of vessels stranded on both sides of the strait due to growing security concerns.
On March 2, Iran announced restrictions on navigation in the Strait of Hormuz and warned it could target vessels attempting to cross the waterway without coordination.
Around 20 million barrels of oil per day normally pass through the strait, and the disruption has pushed up shipping and insurance costs while fueling concerns over global energy markets.
Regional tensions have escalated since the US and Israel launched a joint offensive against Iran on Feb. 28, killing so far some 1,300 people, including then-Supreme Leader Ali Khamenei.
Iran has retaliated with drone and missile strikes targeting Israel, Jordan, Iraq and Gulf countries hosting US military assets, causing casualties and damage to infrastructure while disrupting global markets and aviation.
By Yasin Gungor
Anadolu Agency
energy@aa.com.tr