With the G7’s coordinated petroleum reserve release proving insufficient to fully offset the Hormuz supply crisis, Treasury Secretary Scott Bessent announced Thursday the administration is considering an additional supply measure: temporarily lifting sanctions on Iranian crude oil stranded on tankers in international waters. Bessent said the approximately 140 million barrels of Iranian crude at sea could provide critical additional supply to markets where prices remain above $100 per barrel.
The G7’s coordinated release of 400 million barrels from strategic petroleum reserves, while substantial, has not been enough to fully compensate for the 10 to 14 million barrel daily supply deficit created by Iran’s Hormuz blockade. The sustained price elevation reflects the unprecedented scale of the disruption and the limitations of strategic reserve releases as a supply substitute.
Bessent disclosed that the stranded Iranian crude, originally heading toward Chinese buyers, could serve as an additional supply source if sanctions are temporarily waived. He estimated the oil would provide approximately two weeks of supplemental market relief, during which the US campaign to resolve the Hormuz crisis would continue.
The Treasury has previously issued a comparable waiver for Russian oil, adding approximately 130 million barrels to world supply. Bessent also confirmed that a unilateral US Strategic Petroleum Reserve release, beyond the G7 joint commitment, is being planned to further supplement global supply, while the administration maintains its strict opposition to financial oil market intervention.
Experts were critical of the plan’s strategic logic. Compliance professionals and national security analysts warned that any Iranian oil revenue, even within the narrowest waiver framework, would provide the Tehran regime with funds for military and proxy activities. Critics argued the decision to turn to Iranian oil as a G7 supplement reflects the inadequacy of the overall supply response strategy rather than a coherent geopolitical approach.