The waiver replaces a previous 30-day authorization that expired on April 11 and permits transactions involving Russian crude and petroleum products already loaded at sea, while continuing to exclude dealings tied to Iran, Cuba and North Korea.

The move follows pressure from energy-importing countries, particularly in Asia, grappling with supply disruptions and elevated costs.A Treasury spokesperson said the decision was linked to broader efforts to stabilize markets as diplomatic engagement with Iran intensifies. “As negotiations with Iran accelerate, Treasury wants to ensure oil is available to those who need it,” the spokesperson said.

The extension marks a reversal from comments made earlier in the week by Treasury Secretary Scott Bessent, who had indicated the administration would not renew waivers covering Russian and Iranian oil. The Iranian waiver, issued on March 20, had facilitated the flow of roughly 140 million barrels into global markets, according to Bessent’s prior statements.

Global oil prices fell about 9% on Friday to around $90 per barrel after Iran temporarily reopened the Strait of Hormuz, a critical transit route for global crude supplies. However, the conflict now entering its eighth week has already caused extensive disruption, with more than 80 oil and gas facilities in the Middle East reported damaged, according to the International Energy Agency.

Tehran has warned it could again close the strait if U.S. naval actions targeting Iranian ports continue, raising the risk of renewed supply shocks. The war has been described by the agency as the most severe disruption to global energy supply in history.

The administration’s decision also reflects domestic political pressures, as elevated fuel prices pose risks to Republican candidates ahead of the November midterm elections. U.S. officials said the issue was raised during meetings on the sidelines of G20, World Bank and International Monetary Fund gatherings in Washington, where partner countries urged continued flexibility on supply.

Trump also discussed oil markets during a recent call with Narendra Modi, whose country remains a major importer of Russian crude.The waiver has drawn criticism from lawmakers across party lines, who argue it risks undermining sanctions aimed at curbing Russia’s revenue from its war in Ukraine while also easing pressure on Iran during its confrontation with the United States.

European officials have voiced similar concerns, with Ursula von der Leyen stating that sanctions relief would be premature.Russian presidential envoy Kirill Dmitriev said the policy signaled ongoing economic and energy engagement between Washington and Moscow, adding that earlier waivers could release volumes equivalent to nearly a day of global oil output.

Analysts said the measure underscores the limited policy options available to policymakers confronting simultaneous geopolitical crises and market instability. Brett Erickson of Obsidian Risk Advisers said the damage to global energy systems may be enduring, warning that “the tools available to stabilize them are nearly exhausted.”

Treasury Secretary Scott Bessent said the administration had cautioned governments and banks that continued transactions involving Iranian oil could trigger punitive measures. “If you are buying Iranian oil, that if Iranian money is sitting in your banks, we are now willing to apply secondary sanctions,” he told reporters at the White House.

The warning comes as the U.S. enforces a naval blockade on Iran that began earlier this week, with officials saying they expect the move to curb purchases by key buyers, particularly China, which has accounted for the majority of Iran’s seaborne oil exports.

Bessent said the Treasury had contacted two Chinese banks, warning that they could face sanctions if evidence shows Iranian funds moving through their systems. China’s embassy in Washington did not immediately respond to requests for comment.

Separately, the U.S. Treasury announced sanctions targeting Iran’s oil transportation network, including more than two dozen individuals, companies and vessels, as part of a broader effort to disrupt the country’s energy exports.

The measures follow the administration’s decision not to renew a 30-day sanctions waiver issued on March 20 that had allowed Iranian oil shipments already at sea to reach global markets.

The waiver, which Bessent said facilitated the delivery of about 140 million barrels, is set to expire on April 19.Washington has also allowed a similar waiver covering Russian oil shipments to lapse, reinforcing its broader sanctions enforcement strategy.

U.S. officials said letters had been sent to jurisdictions including China, Hong Kong, the United Arab Emirates and Oman, identifying financial institutions allegedly linked to Iranian transactions and warning of potential enforcement actions.

The steps are part of what the administration has described as a “maximum pressure” campaign aimed at curbing Iran’s oil revenues and limiting its ability to finance regional activities.