The Trump administration has temporarily lifted sanctions on Russian oil shipments in an effort to stabilize global energy markets.
The move comes as crude prices surged past $100 per barrel following US-Israeli military strikes on Iran. The strikes effectively closed the Strait of Hormuz to tanker traffic.
Treasury Secretary Scott Bessent announced the decision late Thursday. He described it as a “narrowly tailored, short-term measure.”
According to Bessent, the policy is designed to avoid providing significant financial benefit to the Russian government.
The Treasury Department issued a license authorizing the delivery and sale of Russian crude oil and petroleum products.
The authorization applies to cargoes loaded on vessels on or before 12:01 a.m. Eastern Time on March 12. Those shipments can be sold through April 11.
A Two-Step Policy Shift
Thursday’s announcement was actually the second step taken within a week.
On March 6, Bessent issued a 30-day waiver allowing Indian refiners to purchase Russian oil already stranded at sea. He said the decision was intended “to enable oil to keep flowing into the global market.”
After issuing that initial waiver, Bessent suggested the administration could go further.
Speaking to Fox Business, he said the government was considering additional measures. “We may unsanction other Russian oil,” he stated.
He explained that hundreds of millions of barrels of sanctioned crude are currently at sea. According to Bessent, allowing those shipments could quickly increase supply.
“By unsanctioning them, the Treasury can create supply,” he said.
Bessent added that the administration plans to continue announcing measures aimed at easing pressure on energy markets.
On Wednesday, President Trump also ordered the release of 172 million barrels of oil from the US Strategic Petroleum Reserve.
Why Now: Iran and the Strait of Hormuz
The immediate trigger for the policy shift is the US-Israeli war with Iran. The conflict has caused extraordinary volatility in global energy markets.
Benchmark Brent crude traded below $60 per barrel earlier this year. Prices jumped to about $80 last Thursday. During thin weekend trading, Brent briefly spiked to $120 before falling back.
The price later stabilized around $92. Analysts say that represents a range of roughly 50% in just five days, which is far outside normal behavior for oil markets.
By Thursday, Brent crude settled above $100 per barrel for the first time since August 2022.
US gasoline prices have also risen sharply. The national average reached about $3.32 per gallon, roughly 34 cents higher than the previous week.
India’s Role
Russia currently accounts for about 35% of India’s oil imports, making it the country’s largest supplier.
India had previously reduced purchases under pressure from Washington. Bessent acknowledged that cooperation while explaining the new waiver.
“The Indians had been very good actors,” he said. “We had asked them to stop buying sanctioned Russian oil this fall, and they did.”
He added that India had planned to replace those shipments with US oil. However, the administration decided to allow Russian purchases temporarily to help ease the global supply gap.
Bloomberg reported that at least two Russian oil tankers initially headed for East Asia changed course toward India this week.
The shift suggests that Indian authorities may be preparing to resume Russian crude imports.
Political Criticism
The policy has drawn strong criticism from Democratic lawmakers.
Senator Jeanne Shaheen of New Hampshire, the ranking member on the Senate Foreign Relations Committee, criticized the move in a statement.
“As Putin helps Iran target Americans in the Middle East, the President is now filling the Kremlin’s war coffers,” Shaheen said.
She argued that the policy could provide Russia with additional revenue while American consumers face rising fuel prices.
Several Democratic senators on the Senate Banking Committee also raised concerns. The group, which includes Senator Elizabeth Warren of Massachusetts, sent a letter demanding a congressional hearing with Bessent before the end of March.
Implications for Ukraine
Analysts warn the decision could have broader geopolitical consequences.
The waivers represent the first major example of the White House separating sanctions policy from Ukraine peace negotiations.
Russia has long sought such a separation but had not achieved it until now.
Some experts argue that this change could weaken US leverage in negotiations with Moscow.
It may provide Russia with partial economic relief without requiring concessions in talks related to the war in Ukraine.
Members of the Ukrainian community in the United States reacted with concern and exhaustion.
“The war, the aggression, has always been fueled by Russia’s sales of their oil,” said one Ukrainian-American activist in Alaska.
The activist added that many Ukrainians feel emotionally drained and hesitant to speculate on what the policy change might mean for the conflict, which is now in its fifth year.
What Comes Next
Bessent emphasized that the measure is temporary and tightly limited.
He said the goal is to increase the global reach of existing oil supply rather than signal a broader shift in sanctions policy toward Russia.
The current exemptions are scheduled to expire on April 11. However, officials have indicated that additional steps could follow depending on how energy markets develop in the coming weeks.
