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Crude Oil Supply · Geopolitical Risk · Iran Oil Sanctions · US Dollar Transactions
The US government formally waived oil sanctions on Iran for two months, allowing Iran to openly sell its oil for the first time since the 1990s and transact in US dollars, potentially generating up to $10 billion in revenue during this period.
This waiver, lasting through August 21, follows President Trump's lifting of a naval blockade and is tied to ongoing nuclear talks in Switzerland. Iran, which previously sold oil primarily to China at discounts due to sanctions, now eliminates an estimated $8-10 per barrel discount, translating to roughly $14 million in additional daily profits or $840 million over the 60-day window.
Clay Seigle, a non-resident scholar with the CSIS Energy Security and Climate Change Program, estimates Iran could earn closer to $8 billion over the 60-day period, assuming exports increase from 1.6 million to 2 million barrels per day at $70 per barrel. An oil industry source notes the temporary nature of the waiver means near-term exports will rely on Iran's estimated 120 million barrels of crude oil already loaded onto tankers, with India and other Asian importers becoming new customers.
Vice President JD Vance stated that prior sanctions were difficult to enforce and did not prevent Iran's oil sales to China, which paid outside the US banking system.