US allows purchases of Russian oil at sea to calm crude price

The US has temporarily authorized countries to buy sanctioned Russian oil currently stranded at sea, aiming to cool energy prices jolted by the US-Israel war with Iran and disruptions around the Strait of Hormuz.

Treasury Secretary Scott Bessent said the short-term step is designed to "promote stability in global energy markets" and will run until 11 April.

The waiver applies only to cargoes already in transit and, he said, will not provide significant financial benefit to Moscow.

What the US authorized and for how long

According to Bessent, the Treasury is providing "a temporary authorization to permit countries to purchase Russian oil currently stranded at sea."

He described it as a "narrowly tailored, short-term measure" that applies only to oil already in transit and "will not provide significant financial benefit to the Russian government."

The authorization lasts until 11 April.

Bessent framed the price shock as temporary, saying "the temporary increase in oil prices is a short-term and temporary disruption that will result in a massive benefit to our nation and economy in the long-term."

He announced the move in a post on X.

How markets responded

Oil had risen nearly 10% on Thursday to nearly $100 per barrel before the announcement, contributing to sharp losses in US equities.

After Bessent’s post, West Texas Intermediate (WTI) crude pulled back by about $2 to $95.23 per barrel.

In Friday trading in Asia, Brent crude was 0.3% lower at $100.08 a barrel.

Crypto markets also moved.

Bitcoin, which spent much of the day near $70,000, jumped to $72,000 in the minutes following Bessent’s post and was up 2.2% over the past 24 hours.

Why the waiver was issued now

Attacks on ships and energy infrastructure in the Gulf and the effective closure of the Strait of Hormuz have roiled global energy markets.

Roughly a fifth of the world’s oil typically passes through the narrow waterway.

On Thursday, oil prices climbed back above $100 a barrel and stock markets fell after three more cargo vessels were hit in the Gulf and Iran’s new supreme leader vowed to keep blocking the strait.

What else authorities are doing

The International Energy Agency said Wednesday it would release a record 400 million barrels of oil to help address the supply crunch.

Several Asian governments, major buyers of Gulf crude, also unveiled measures.

The Philippines, which gets around 95% of its crude from the Middle East, told public workers to shift to a four-day workweek to save fuel.

Japan, South Korea, and Thailand announced caps on petrol prices.

Bessent also said the US would start escorting vessels through the Strait of Hormuz "as soon as it is militarily possible."

He told Sky News the potential need for escorts "was always in our planning," adding that "as soon as it is possible to ensure safe passage we will do it."