The U.S. will not renew a 30-day waiver of sanctions on Iranian oil at sea that expires this week, and quietly let a similar waiver on sanctions on Russian oil expire over the weekend, two administration officials told Reuters on Tuesday, as the U.S. imposes a blockade on shipments from Iranian ports.
Tuesday’s move signals that “Treasury is going full force on Economic Fury” on Iran, an apparent reference to Operation Epic Fury, the U.S.-led military campaign against the country, one of the officials said.
The Trump administration has long said it is applying “maximum pressure” on Iran over its nuclear program and support for militants across the Middle East, though sanctioned oil has continued to reach China.
The waiver, which the Treasury Department issued on March 20, allowed some 140 million barrels of oil to reach global markets and helped relieve pressure on energy supply during the war on Iran, Treasury Secretary Scott Bessent said last month. The waiver is set to expire on April 19. The U.S. did not renew the waiver on Russian oil at sea which expired on Saturday, the sources said.
The moves signal an end to the Trump administration’s controversial efforts to use the sanctions waivers to free up more oil supplies and lower global energy prices that have spiked since the start of the U.S. and Israeli war against Iran. U.S. lawmakers from both political parties had slammed the administration saying the sanctions waivers stood to help the economies of Iran, while it was at war with the U.S., and of Russia as it was at war with Ukraine.
Still, Washington has a range of penalties it can apply to institutions involved in illicit activities with Iran such as buying its oil, including secondary sanctions, one of the sources said.
“In addition, with the snapback of U.N. sanctions on Iran, and its history of trying to hide behind seemingly legitimate activity to conduct its illicit conduct, any activity with Tehran could trigger additional sanctions,” the person said.
US WARNS CHINA, UAE, OMAN, HONG KONG
The Treasury added pressure on Tuesday on countries and administrations that host banks the U.S. says have helped funds get to Iran, one of the sources said. Treasury sent letters to China, Hong Kong, the UAE, and Oman identifying banks that have allowed Iranian illicit activity.
The letters came after Treasury informed banks late last year that Iran processed at least $9 billion through U.S. correspondent accounts in 2024, using a series of front companies, in Hong Kong, the UAE and other places.
“My hope is for your swift action to identify and stop any illicit activity linked to Iran to avoid further action from Treasury,” Bessent said in the letter, a copy of which was seen by Reuters.
The embassies in Washington of China, Oman and UAE did not immediately respond to requests for comment. Hong Kong’s economic and trade office in Washington did not immediately respond to a request for comment.
Bessent told reporters earlier that the U.S. blockade of the Strait of Hormuz would ensure that no Chinese ships or others would be allowed to pass.
“So they’re not going to be able to get their oil. They can get oil. Not Iranian oil,” Bessent said, adding that China had been buying more than 90% of Iranian oil and it constituted about 8% of their annual purchases.
Source: Reuters
-- Agencies
