In response to the surge in global energy prices triggered by the Middle East conflict, the U.S. Department of the Treasury has announced a further 30-day extension of the sanctions exemption for Russian oil that has already been loaded onto vessels.
Treasury Secretary Scott Bessent stated on social media that this "temporary general license" is designed to allow the "most vulnerable nations" temporary access to Russian oil currently stranded at sea. He noted the move would "provide additional flexibility to the spot crude market and ensure oil reaches countries most susceptible to energy shortages."
This exemption follows two previous similar authorizations. The prior exemption had expired on May 16. Despite criticism from Ukraine and some U.S. lawmakers, who argue the measure provides funding for Russia's war efforts and has not significantly reduced domestic fuel costs, the administration has opted for another extension. The current average U.S. gasoline price has risen to approximately $4.50 per gallon, reaching its highest level since 2022.
Beyond extending the Russian oil exemption, the U.S. government is also utilizing multiple tools to stabilize the market. These include releasing strategic petroleum reserves, temporarily waiving the Jones Act to permit foreign vessels to transport fuel between U.S. ports, and suspending the federal gasoline tax. This series of measures aims to alleviate supply pressures exacerbated by the war in Iran and disruptions to transit through the Strait of Hormuz.
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