Treasury Secretary Scott Bessent unveiled a plan Thursday to deploy sanctioned Iranian crude oil against the market chaos created by Iran’s own Strait of Hormuz blockade. Bessent said the US is considering temporarily lifting sanctions on approximately 140 million barrels of Iranian crude stranded on tankers in international waters, redirecting it to global buyers to ease a price crisis that has kept crude above $100 per barrel.
The Hormuz blockade has been the dominant driver of the current oil price surge, removing between 10 and 14 million barrels of daily supply from global markets for close to two weeks. The economic consequences have been broad and significant, affecting consumers, businesses, and governments worldwide that depend on affordable and stable energy supply.
Bessent said the Iranian crude on tankers, originally bound for Chinese ports, represents a ready-made supply resource that could be unlocked through a targeted waiver. He described the plan as using sanctioned Iranian barrels to counteract the market disruption created by Iran’s own strategic decisions, providing an estimated two-week supply cushion during the US campaign against the blockade.
The Treasury has previously used this approach for Russian oil, adding approximately 130 million barrels to world supply. Bessent confirmed an additional unilateral US Strategic Petroleum Reserve release beyond the G7’s 400 million barrel commitment is also planned, while the administration has categorically ruled out any financial oil market intervention.
Sanctions experts and national security analysts challenged the strategy. They argued that deploying Iranian barrels against market chaos would simultaneously benefit the Iranian regime financially, providing revenue to fund military activities and proxy operations. Critics called the plan a double-edged sword — using Iran’s oil against its strategy while giving Iran the financial means to continue that very strategy.