The Trump administration on Thursday issued a new license allowing countries to temporarily purchase certain Russian oil products, the latest efforts by the US to mitigate surging crude prices following the war it launched with Iran.

Crude oil prices have surged on the closure of the Strait of Hormuz, through which one-fifth of the world’s oil travels, sparking a historic shortage in global energy supplies.

Iran’s Islamic Revolutionary Guard Corps has warned it will set the region’s oil and gas “on fire” in retaliation against any attacks on Iran’s energy infrastructure.

According to CNN’s reporting, US national security officials significantly underestimated Iran’s willingness to close the Strait of Hormuz and the subsequent global energy crisis. Now the US is rushing to contain the economic fallout.

At least 16 oil tankers, cargo ships and other vessels have been attacked in and around the Strait of Hormuz, the Arabian Gulf and the Gulf of Oman in the past two weeks, according to the UKMTO which monitors maritime traffic. Iran has reportedly been setting mines in the strait, and the US military said it sunk 16 minelayers in the area earlier this week.

Nonetheless, in an interview with Fox News, US President Donald Trump suggested oil tanker crews in the Strait of Hormuz should simply “show some guts” and insisted “there’s nothing to be afraid of.”

The US decision to temporarily lift sanctions on oil from Russia, a major exporter, comes despite previous pressure on Russian oil companies as part of a bid to stem the flow of cash funding Moscow’s war in Ukraine.

“To increase the global reach of existing supply, @USTreasury is providing a temporary authorization to permit countries to purchase Russian oil currently stranded at sea,” Treasury Secretary Scott Bessent wrote on social media. “This narrowly tailored, short-term measure applies only to oil already in transit and will not provide significant financial benefit to the Russian government, which derives the majority of its energy revenue from taxes assessed at the point of extraction.”

The license, posted to the US Treasury site, only applies to Russian crude or petroleum products loaded on vessels as of March 12. The license authorizes those shipments through April 11.

‘Putin windfall’

Democratic Sen. Jeanne Shaheen of New Hampshire and ranking member on the Senate Committee on Foreign Relations criticized the decision on social media. “As Putin helps Iran target Americans in the Middle East, @POTUS is now filling the Kremlin’s war coffers. Instead of squeezing Russia’s faltering economy, the President’s ill-planned war is giving Putin a windfall while American families face higher prices,” Shaheen wrote.

CNN previously reported that the US has granted Indian refiners a 30-day waiver to buy Russian oil currently stranded at sea. Bessent, at the time, said the move was “to enable oil to keep flowing into the global market.”

As the energy shortage worsens, countries have scrambled to stem the economic impact by curbing consumption, capping fuel prices and tapping into emergency oil reserves. Analysts, economists and traders have warned that even a rapid end to the war won’t necessarily mean a quick re-opening of the strait.

On Friday, Goldman Sachs revised its price forecast 20% higher for Brent crude oil this year, expecting $100 a barrel in March and $85 a barrel in April, assuming a three-week disruption to the Strait of Hormuz.

However, if the closure extends to two months, that would push its end-of-year forecast from $71 a barrel to $93 a barrel. (CNN)

Update news