US President Donald Trump announced that the government will waive sanctions on some countries to ensure oil supply and curb prices amid the Middle East conflict. He stated the suspension would last until the Strait of Hormuz functions normally, but provided no details. Sources suggest the measure may target Russian oil.
US President Donald Trump stated on Monday (9) that the government is waiving oil-related sanctions against some countries as part of efforts to maintain adequate supply and low prices during the Middle East conflict. "So, we have sanctions against some countries. We will suspend these sanctions until the strait [of Hormuz] is functioning," he said, without providing further details.
Trump also mentioned having a "very good" call with Russian President Vladimir Putin about the Ukraine war. Sources consulted by Reuters indicate that the easing may target Russian oil, which would boost global supply amid disruptions in Middle East shipments due to the expansion of the war in Iran. However, this change could complicate US efforts to limit Russian revenues for the Ukraine conflict.
Analysts and energy sector executives note that the White House has few options to quickly curb rising oil prices unless tanker flow through the Strait of Hormuz – which carries about one-fifth of the world's supply – is restored. A previous plan to provide naval escorts and insurance for these ships has not significantly increased maritime traffic.
The energy market turbulence comes at a sensitive time for Trump, who is seeking to keep fuel prices low as part of his economic message to voters, particularly with midterm elections approaching that will determine Republican majorities in Congress. A prolonged rise in oil and gasoline costs could affect the broader economy, raising transportation and consumer prices.
Easing sanctions on Russia could involve broad relief or targeted options, allowing certain countries to buy Russian oil without US penalties, according to three anonymous sources to Reuters. Last week, the US issued a temporary exemption for India to acquire Russian oil cargoes to offset Middle East supply losses.
US authorities are discussing with the G7 a possible joint release of crude oil from strategic reserves. Energy Secretary Chris Wright confirmed that the US is considering coordinating sales from its reserve, but no decision has been made. He denied plans to impose restrictions on US energy exports. Other measures under discussion include interventions in oil futures markets, suspension of federal taxes, and elimination of Jones Act requirements, which restrict fuel transport to US-flagged ships.
