Treasury Secretary Scott Bessent proposed Thursday that Iranian crude oil stranded on tankers could be used to buy strategic breathing room during the Strait of Hormuz crisis, revealing the administration is considering temporarily lifting sanctions on approximately 140 million barrels of Iranian crude in international waters. Bessent said the breathing room created by two weeks of additional supply would allow the US campaign against the blockade to develop more effectively.
The concept of strategic breathing room reflects the administration’s view that the most acute economic pressure created by Iran’s Hormuz blockade — the period of highest vulnerability — can be managed through targeted supply interventions that create a window for longer-term solutions to take effect. The blockade has been removing between 10 and 14 million barrels of daily supply from global markets for close to two weeks.
Bessent identified the approximately 140 million barrels of Iranian crude on tankers, originally heading toward Chinese buyers, as the supply capable of creating the needed breathing room. A targeted temporary waiver could redirect this oil to global markets, providing roughly two weeks of price support during which the US campaign against the Hormuz closure could achieve more decisive results.
The Treasury has previously used comparable measures to create strategic breathing room, including a waiver for Russian oil that added approximately 130 million barrels to world supply. An additional unilateral US Strategic Petroleum Reserve release beyond the G7’s 400 million barrel commitment is also being planned, alongside the administration’s firm policy against financial market intervention.
Policy and compliance experts questioned both the breathing room concept and the cost of creating it. They warned that the breathing room purchased through Iranian crude oil sales comes at the price of revenue for the Tehran regime, which could be used to fund military activities and proxy support during the very window the breathing room is meant to create. Critics argued that buying breathing room from an adversary’s own oil sales is a fundamentally compromised transaction, one that strengthens rather than weakens the adversary during the strategic window created.