US Revokes Oil Sanctions Waiver After Hormuz Tanker Attacks

New Transactions Involving Iranian Crude Oil and Petroleum Products Banned
Ongoing Transactions Must Be Settled by 12:01 a.m. on July 17

The United States has revoked its sanctions waiver on transactions involving Iranian crude oil, citing the recent attacks on oil tankers in the Strait of Hormuz. If Iran pushes back against this decision, it is likely to disrupt subsequent negotiations between the two sides.

On July 7 (local time), the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced that it would cancel the general license that had temporarily permitted the production, delivery, and sale of Iranian crude oil, petrochemicals, and petroleum products.

OFAC explained that, starting from this day, new purchases, shipments, and other new transactions involving Iranian crude oil and petroleum products would be prohibited. However, transactions that had already been executed under the previous license can be settled until 12:01 a.m. (U.S. Eastern Time) on July 17. Even during this period, any payments due to sanctioned parties must be deposited in blocked accounts within the United States.

Previously, on June 21, OFAC had issued a general license allowing transactions involving Iranian crude oil for 60 days. This was a sanctions relief measure provided to Iran while follow-up negotiations were underway after the United States and Iran signed the previous memorandum of understanding (MOU).

However, the United States revoked the license early after three oil tankers were attacked in the Strait of Hormuz in recent days. The waiver was originally intended to be in effect until August 21, but it was terminated just over two weeks after taking effect.

This measure is seen as the U.S. response to the ship attacks in the Strait of Hormuz. The New York Times (NYT) reported that, in addition to oil tankers, a Qatari liquefied natural gas (LNG) carrier was also attacked in the area.

According to foreign media reports, the Qatari LNG carrier Al Rekayyat was hit by a drone strike, causing a fire in the engine room. Qatar has accused Iran of being behind the attack. Iran, however, has not directly acknowledged responsibility. Nevertheless, as the Iranian government has long asserted control over the Strait of Hormuz, U.S. pressure on Iran is expected to intensify.

A U.S. government official told the NYT, “Iran’s actions in the Strait of Hormuz are unacceptable to the United States,” adding, “There will be consequences.” The United States appears to be making it clear to Iran that the terms of further negotiations will be strictly enforced by revoking the sanctions waiver. The official also stated that Iran must “demonstrate good behavior” if it wishes to benefit from the peace agreement, while also confirming that negotiations toward a final agreement will continue.

The United States has long employed both “carrot and stick” tactics with respect to Iran. Early this year, the Trump Administration implemented temporary sanctions relief to allow more Iranian crude oil to flow into the global market in an effort to stabilize international oil prices. However, it later tightened sanctions to pressure the Iranian economy and imposed a military blockade to prevent the sale of Iranian crude oil.

Meanwhile, following their armed clash in the Strait of Hormuz late last month, the United States and Iran agreed to halt military actions and have continued indirect talks through a mediator in Doha, Qatar. However, significant differences reportedly remain over the key issue of denuclearization.

This content was produced with the assistance of AI translation services.