US allows Iranian oil flow amid war: Bessent

Washington: The United States is allowing Iranian oil tankers to move through the Strait of Hormuz despite the ongoing conflict, as part of efforts to stabilise global energy supplies, Treasury Secretary Scott Bessent said.

“We are seeing more and more the fuel ships start to go through. The Iranian ships have been getting out already. And we’ve let that happen to supply the rest of the world,” Bessent told CBS News.

He added that Indian and Chinese vessels were also moving through the region. “We’ve seen Indian ships go out now. So the Indians who rely very heavily on Gulf oil, we believe some Chinese ships have gone out,” he said.

The remarks come as oil prices have surged, with US crude touching $100 a barrel amid fears of disruption in one of the world’s most critical maritime choke points.

Bessent said Washington expects shipping activity to increase gradually without the need for military escorts. “We think that there will be a natural opening that the Iranians are letting out. And for now, we’re fine with that. We want the world to be well supplied,” he said.

The administration has also taken steps to ease supply pressures by issuing a temporary waiver on Russian oil shipments already at sea. “We gave a 30-day waiver for Russian oil that was already on the water. It was about 130 million barrels,” he said.

Bessent pushed back against concerns over easing restrictions, arguing that keeping prices stable limits Moscow’s earnings. “If oil spikes to $150, but Putin was getting 70 per cent of that, or oil stays at 95 to a hundred, where’s he getting more money if it spikes to 150?” he said.

He said the global supply shortfall remains significant but manageable. “It looks like the deficit is about 10 or 14, and that’s before any of the ships are coming out of the straits,” he said.

To offset disruptions, Saudi Arabia and the United Arab Emirates have redirected some exports away from the Gulf. Strategic petroleum reserves have also been tapped globally. “The global SPR release largest ever, it was 400 million barrels,” Bessent said.

The Treasury Secretary framed the broader military campaign as an attempt to weaken Iran’s regional reach. “President Trump has made it clear that… his goal is to degrade and destroy the capabilities, the military capabilities of the regime,” he said, adding that Washington wants “to destroy the Iranian ability to project power outside of their borders.”

He described Iran as “the head of the snake for global terrorism everywhere,” citing its links with proxy groups and activities across regions.

At the same time, he dismissed the idea of a coordinated Iranian response, suggesting internal disarray. “There is this coherent Iranian plan… First of all… they are a smoothly functioning government… we believe that the current ayatollah is injured… and maybe incapacitated,” he said.

The Strait of Hormuz handles a large share of global oil and gas shipments, making any disruption a major concern for energy markets. Asian economies, including India, are particularly exposed due to their dependence on Gulf crude.

IANS