US Allows Sale of Iranian Oil Stranded At Sea Amid Crude Oil Price Rally Due To Iran-US War

Washington is allowing a limited sale of Iranian oil and petrochemical cargoes stuck at sea, aiming to cool fuel costs as the conflict between the United States and Iran disrupts supplies and sends Brent crude above $112 a barrel, its highest point since mid-2022, before easing slightly in later trade.

US Treasury Secretary Scott Bessent announced the move on 21 March in a post on X, saying the Treasury had issued a short-term authorisation for these stranded shipments. The step comes as fighting linked to the war in the Middle East squeezes flows, with many tankers unable to discharge their Iranian-origin cargoes.

US permits temporary sale of Iranian oil stranded at sea: key licence terms

The Treasury's general licence applies to Iranian crude and petrochemical products loaded on vessels on or before 12:01 am New York time on 20 March. It allows these cargoes to be sold until 12:01 am New York time on 19 April, giving traders and buyers a narrow window to redirect supplies into global markets.

The authorisation also covers practical operations. Ships carrying this Iranian oil or petrochemical output are allowed to dock and anchor safely while the cargoes are transferred or sold. Bessent described the measure as "narrowly tailored" and limited in duration, underscoring that it targets material already at sea rather than new exports from Iran.

US permits temporary sale of Iranian oil stranded at sea: war and price shock
The decision follows a sharp energy shock triggered after Donald Trump launched military action against Iran about three weeks ago, working with Israel. That campaign has largely choked shipments through the Strait of Hormuz, a vital maritime route through which about 20% of global oil supply usually passes each day.

The disruption in Hormuz has helped push Brent crude more than 50% higher during March. Traders fear further supply losses if the conflict widens or continues for months. The Trump administration has therefore sought ways to increase available barrels, including measures similar to earlier steps taken for Russian oil stranded under sanctions.

US permits temporary sale of Iranian oil stranded at sea: Bessent's explanation
In Bessent's post on X, the Treasury Secretary wrote: "Today, the Department of the Treasury is issuing a narrowly tailored, short-term authorization permitting the sale of Iranian oil currently stranded at sea," outlining the basic scope of the move. The post framed the licence as part of a bigger energy strategy.

Bessent linked the authorisation directly to attacks blamed on Iran. "In response to Iran's terrorist attacks against global energy infrastructure, the Trump Administration will continue to deploy America's economic and military might to maximize the flow of energy to the world, strengthen global supply, and seek to ensure market stability," Bessent said, presenting the step as both economic and security policy.

US permits temporary sale of Iranian oil stranded at sea: extra barrels and hoarded cargo
The Treasury Secretary argued that releasing these Iranian oil volumes would ease short-term tightness. Bessent said that about 140 million barrels could reach buyers once the stranded cargoes are traded. Those supplies have been stuck because of sanctions, limiting where ships can legally deliver them.

Bessent also highlighted China's role in absorbing sanctioned flows. "At present, sanctioned Iranian oil is being hoarded by China on the cheap. By temporarily unlocking this existing supply for the world, the United States will quickly bring approximately 140 million barrels of oil to global markets... helping to relieve the temporary pressures on supply caused by Iran," Bessent said, stressing a shift from concentrated to broader access.

US permits temporary sale of Iranian oil stranded at sea: wider supply push
The Treasury Secretary placed the licence within a broader effort to add barrels worldwide. "So far, the Trump Administration has been working to bring around 440 million additional barrels of oil to the global market, undercutting Iran's ability to leverage its disruptions in the Strait of Hormuz," Bessent said, describing attempts to offset Tehran's influence over a critical chokepoint.

Rising prices still reflect market anxiety. Brent settled above $112 a barrel on 21 March, its strongest close since mid-2022, before easing in post-settlement trading. Prices dipped after Donald Trump said he was considering "winding down" US military efforts against Iran, a remark traders read as a possible sign of reduced escalation risk.

US permits temporary sale of Iranian oil stranded at sea: timeline and volumes
The temporary licence and associated supply plans can be summarised as follows, based on Treasury statements and Bessent's comments on X.