U.S. moves to reimpose sanctions on Iranian oil... Bessent says "China’s purchases will be cut off"

Financial News, New York – Lee Byung-chulThe United States of America (U.S.) is moving to re-tighten sanctions on Russian and Iranian oil that had been temporarily eased in response to the war. Combined with the closure of the Strait of Hormuz, tensions in the global energy market are rising again.
Scott Bessent, the U.S. Treasury Secretary, announced at a White House briefing on the 15th (local time) that the government will not renew the 'general license' for oil from Russia and the Islamic Republic of Iran. A general license is a measure that allows countries to purchase oil from sanctioned states for a limited period.
When oil prices surged due to the war in the Middle East, the U.S. temporarily relaxed some sanctions last month to help stabilize supplies for certain countries. With the latest move, those measures are effectively being rolled back. Bessent explained, "The volumes previously approved have already been exhausted."
The new measures are expected to have a direct impact on China in particular. He noted, "China has been purchasing more than 90% of the Islamic Republic of Iran’s oil," and added, "Because of the closure of the strait, China’s purchases will be cut off."
The U.S. also warned of possible secondary sanctions on Chinese financial institutions. Washington has made clear it will impose penalties if inflows of Iranian funds are detected.
Bessent nevertheless pointed to the possibility of stabilizing oil prices. He said, "If the Strait of Hormuz reopens, shipments could return to normal within a week," and projected, "This summer, gasoline prices could fall to around $3 per gallon."
With war, sanctions, and the closure of a key strait all unfolding at once, volatility in the global crude oil market is expected to persist for the time being.



pride@fnnews.com Reporter Lee Byung-chul Reporter