Foreign Affairs

Trump Officials Weigh Freeing Blacklisted Tankers To Cut Record Shipping Costs

Oil tanker, photo not from story (Jujovar2010 via Wikimedia Commons)

The Trump administration is reportedly weighing whether to let blacklisted tankers haul legal oil as record shipping costs squeeze American crude sales overseas.

The administration is discussing relief for so-called shadow fleet ships — which have carried oil from Russia, Iran and Venezuela — to bring down record freight rates, a U.S. official told Reuters Wednesday. The discussions come days after the Treasury Department said its Oct. 8 sanctions round “effectively neutralizes the vast majority of Iran’s remaining shadow fleet network.”

The talks focus on allowing crude and fuel not under U.S. sanctions to travel on blacklisted ships, with companies needing the Treasury Department’s approval to use them, according to the official. Russian and Iranian oil would remain off-limits, the outlet reported.

The Energy Department and the White House did not immediately respond to the Daily Caller News Foundation’s requests for comment. The Treasury Department did not provide a comment on the record.

Energy Secretary Chris Wright told the World Petroleum Congress in a recorded video shown in Saudi Arabia that officials were discussing relief to lower freight costs that have hurt demand for American crude, according to research group Energy Aspects, Reuters reported. The outlet said it was unable to get the complete video or a transcript.

The Energy Department told the outlet that easing the restrictions would not help Russia ship oil or fuel, while the Treasury Department directed Reuters’ questions to the Energy Department.

The Treasury Department’s Oct. 8 action targeted 17 tankers it said had hauled Iranian crude, fuel and petrochemicals by the millions of barrels to buyers across South and East Asia.

“No enabler of Iranian sanctions evasion is safe from the full force of Treasury’s authorities,” Treasury Secretary Scott Bessent said in the release.

Easing the sanctions would do little to lower freight rates, Energy Aspects said in a client note cited by Reuters, noting that “most tankers sanctioned over Russian or Venezuelan links have been actively trading over the past three months.”

Insurers covering the ships must still follow European Union and United Kingdom rules, which maritime industry sources told the outlet would keep freight rates from falling broadly.

The discussions follow Trump’s move to temporarily ease sanctions on Russian diesel until April 7, 2027, which drew criticism from Ukrainian President Volodymyr Zelenskyy, European countries and some Republican senators, Reuters reported. A group of senators from both parties said on Oct. 11 that the imports run counter to the 2022 law banning Russian energy imports.