U.S. clears one-month buys of Russian oil already at sea

On Thursday, the Treasury Department authorized a one-month period for countries to buy Russian oil and petroleum products already at sea, limited to cargoes loaded on or before that day. The license is intended to ease a supply crunch and high prices as global oil flows face disruption.

Treasury Secretary Scott Bessent wrote that the authorization will permit countries to purchase Russian oil ‘currently stranded at sea.' He added that it covers only barrels in transit and ‘will not provide significant financial benefit to the Russian government, which derives the majority of its energy revenue from taxes assessed at the point of extraction.' Department guidance specifies the license runs for one month and applies only to cargoes loaded by Thursday.

The department estimates roughly 124 million barrels of Russian oil are at sea. Officials are seeking to extend the reach of existing supply as the war with Iran constrains petroleum trade and lifts prices. Brent crude traded just above $100 per barrel on Thursday afternoon, compared with about $72 before the conflict began in late February.

Last week, Treasury issued a separate, narrower license that allows India to buy Russian oil and petroleum products for one month. U.S. sanctions imposed after Russia's 2022 invasion of Ukraine have complicated transactions with Russia's energy sector through price caps and limits on shipping, insurance, and financial services.

The temporary relief drew swift criticism from Democrats. Sen. Brian Schatz of Hawaii posted on X, ‘Looks like we fought Iran and Russia won.' In a letter last week, Senate Minority Leader Chuck Schumer and 11 other Democrats argued that higher oil prices have already delivered a windfall to Moscow, writing that easing restrictions gives ‘Putin, his shadow fleet, and traders still dealing in sanctioned oil a free pass to increase oil shipments to Russia's second-largest importer.'

One day before the license, Russian envoy Kirill Dmitriev met in Florida with U.S. negotiators Steve Witkoff and Jared Kushner. Dmitriev later wrote that the group discussed the ‘current crisis on global energy markets' and posted that ‘Russian energy is indispensable to easing the world's largest energy crisis.'

The administration is considering additional supply steps. Officials plan to release about 172 million barrels from the Strategic Petroleum Reserve. President Trump has weighed ordering the U.S. Navy to escort tankers through the Strait of Hormuz, and earlier this week described the option of ‘taking [the strait] over' to keep shipments moving.

Commercial traffic through the Strait of Hormuz – normally carrying about one-fifth of global oil – has slowed as Iran strikes vessels and warns shippers, reducing flows from major Arab producers. The bottleneck has tightened supply as sanctions and compliance risks make traders and insurers more cautious about handling Russian barrels.

Treasury underscored the license's narrow scope: it applies only to Russian oil and refined products that were already loaded on ships by Thursday, and it expires after one month. Bessent argued that because much of Russia's budget is funded by taxes at the wellhead, authorizing sales of barrels already in transit is unlikely to generate sizable new revenue for the Kremlin.