The Donald Trump administration has issued a temporary authorization for countries to purchase Russian oil currently “stranded at sea,” a move designed to stabilize global energy markets as tensions from the Iran-U.S. war push Brent crude prices past $100 per barrel.
Strategic Waiver Amid Rising Costs
Treasury Secretary Scott Bessent announced the “narrowly tailored, short-term measure” on Friday, aiming to inject immediate supply into a volatile market. The directive specifically targets oil already in transit, providing a release valve for global inventories without permanently easing the broader sanctions regime against Moscow.
“To increase the global reach of existing supply, @USTreasury is providing a temporary authorization to permit countries to purchase Russian oil currently stranded at sea,” Bessent stated.
The decision comes as WTI Crude hovers near $95.17 and Brent Oil sits at $100.13, as of the publication of this article, both flirting with 52-week highs.
Financial Impact and Safeguards
The administration emphasized that the move is calculated to prevent a windfall for the Kremlin. According to the Treasury, the measure applies only to oil already extracted and loaded, meaning the bulk of the fiscal benefit to Russia has already occurred through domestic taxation.
“This will not provide significant financial benefit to the Russian government, which derives the majority of its energy revenue from taxes assessed at the point of extraction,” Bessent clarified.
Long-Term Energy Outlook
While the waiver provides immediate relief, the administration remains focused on domestic production. Bessent noted that President Trump’s “pro-energy policies” have already driven U.S. production to record levels, though the current Middle East instability created a temporary “short-term disruption.”
The Treasury maintains that these decisive steps are necessary to ensure that “hardworking Americans” do not bear the brunt of geopolitical instability, viewing the current price spike as a hurdle that will eventually result in a “massive benefit to our nation and economy in the long-term.”
WTI Tracker Jumps Nearly 70% YTD
United States Oil Fund LP (NYSE:USO), which tracks the WTI Crude futures, was up 22.93% over the last five sessions and 69.76% year-to-date.
Also, it has returned 61.49% over the last six months and 62.62% over the year. On Thursday, it closed 9.57% higher at $118.39.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo courtesy: Saku_rata160520 via Shutterstock
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