Despite a new 30-day sanctions waiver from the US Treasury allowing for the purchase of stranded Russian oil, Brent crude remained above $100 per barrel on Friday. The Trump administration is attempting to combat a “surge in prices” that has seen US fuel costs jump by 65 cents per gallon in just 30 days. The waiver applies specifically to oil already in transit, representing a tactical retreat in the face of a mounting global energy shortage.
The root of the current market volatility is the war in Iran, which has effectively shut down the Strait of Hormuz. Iran’s military has vowed to block all oil exports from the Middle East, and recent reports suggest they have begun mining the strait to enforce this blockade. This has created a massive supply gap that the US and its allies are struggling to fill with domestic production alone.
Treasury Secretary Scott Bessent defended the move, stating that the primary goal is to keep prices low for the global economy. He argued that the “narrowly tailored” measure won’t significantly aid Russia, as most of their oil revenue is collected at the point of extraction rather than sale. This follows a similar waiver granted to India, suggesting a broader US effort to find emergency oil supplies.
The International Energy Agency has also taken the unprecedented step of releasing 400 million barrels from government reserves. While this is the largest release in history, it has so far failed to significantly lower prices due to the sheer volume of oil lost from the Middle Eastern theater. Iran has warned that if the US continues its military campaign, prices could potentially reach $200 per barrel.
Politically, the energy spike arrives at a difficult time for the Trump administration, with midterm elections just months away. President Trump has framed the conflict as a necessary mission to stop Iran from obtaining nuclear weapons, but the economic fallout is testing his support. The 30-day window on Russian oil serves as a temporary measure to bridge the gap during one of the most volatile periods in energy history.