US Treasury Considers Easing Sanctions on Russian and Iranian Oil Tankers
According to sources familiar with the matter cited by the Financial Times, the Trump administration is considering allowing the sale of sanctioned oil tankers to legitimate operators and lifting restrictions so that these vessels can operate in the global market. The proposal involving a “shadow fleet”—a network of ships typically used to transport oil from sanctioned nations—comes as the U.S. seeks to curb soaring fuel prices ahead of the midterm elections in November.
Analysts believe that easing sanctions on oil tankers is unlikely to have a significant impact on fuel prices. However, a U.S. Treasury official said the Office of Foreign Assets Control (OFAC) may consider authorizing the sale of these vessels to legitimate buyers on a case-by-case basis. According to the official, the goal is to remove the vessels from the sanctioned operating network and transition them to legitimate commercial use.
US Energy Secretary Highlights Critical Bottleneck in Oil Tanker Capacity
At the World Oil and Gas Conference in Riyadh, Saudi Arabia, US Energy Secretary Chris Wright stated that the shortage of oil tankers is becoming a critical bottleneck, driving up global transportation costs. Easing sanctions could help supplement the capacity to transport crude oil and refined fuels, thereby easing pressure on the market.
Analysts Skeptical of Sanctions Easing Impact
Bob McNally, former energy advisor to President George W. Bush and currently chairman of the consulting firm Rapidan Energy, believes the US administration is exploring all options to bring fuel prices down before the election, even if the actual impact of some measures may be very small.
Global Diesel Shortage Expected to Last Until Mid-2027
The International Energy Agency (IEA) warned that the global diesel shortage could last until mid-2027. The US president also allowed the use of tax-free diesel intended for agricultural or industrial purposes on public roads, as part of efforts to cool down fuel prices.
Easing Sanctions Unlikely to Address Current Shortage
Analysts are skeptical that easing sanctions on shadow fleets will significantly address the current shortage. According to the consulting firm Energy Aspects, approximately 13-19% of the global oil tanker fleet is on the US sanctions list. However, many of these vessels are old and dilapidated, limiting the potential for additional transport capacity. The company also noted that the majority of oil tankers previously sanctioned due to links to Russia have continued operating in the last three months.
Kpler Research Group Believes Measure Unlikely to Bring Significant Change
According to the Kpler research group, this measure is unlikely to bring about a significant change to the current oil shipping crisis. They believe that the increase in fuel prices stems mainly from the risk of escalating conflict in the Middle East, rather than just a shortage of oil tankers.
Original Article: The US president is considering easing sanctions on Russian and Iranian oil tankers. — Vietnam