Treasury Secretary Bessent Considers Groundbreaking Iranian Oil Move to Restore Market Balance

Treasury Secretary Scott Bessent is considering a groundbreaking move to restore global oil market balance: temporarily lifting sanctions on Iranian crude oil stranded on tankers in international waters, he revealed Thursday. Bessent said the potential release of approximately 140 million barrels of Iranian crude would help offset the supply imbalance created by Iran’s Strait of Hormuz closure, which has kept prices above $100 per barrel for close to two weeks.Iran’s Hormuz blockade has created one of the most significant supply-demand imbalances in global oil markets in recent years, removing between 10 and 14 million barrels of daily supply from circulation. Restoring balance to this market has become a central challenge for the administration, requiring consideration of measures that go well beyond standard crisis response tools.Bessent said the approximately 140 million barrels of Iranian crude on tankers, originally destined for Chinese ports, could help restore market balance if sanctions are temporarily waived. Redirected to global buyers, this oil would provide roughly two weeks of supply support during the US campaign to resolve the Hormuz standoff.The Treasury has previously taken groundbreaking steps to restore market balance, including a waiver for Russian oil that added approximately 130 million barrels to world supply. An additional unilateral US Strategic Petroleum Reserve release beyond the G7’s 400 million barrel coordinated commitment is also being planned, while the administration has categorically ruled out any financial market intervention.Experts assessed the groundbreaking move critically. Compliance professionals and national security analysts warned that restoring oil market balance through Iranian crude sales would simultaneously create a financial imbalance favoring the Tehran regime, providing funds for military activities and proxy support. Critics said the groundbreaking nature of the move reflects the extraordinary scale of the crisis but warned that groundbreaking policy departures carry groundbreaking risks that can reshape the strategic landscape in ways that outlast the immediate market problem.