This policy effectively turns any tanker carrying Iranian crude into a pariah vessel in the eyes of US regulators, making it nearly impossible for the oil to find its way into American refineries through legitimate channels. This domestic abundance insulates the country from supply shocks in specific regions, including the Persian Gulf.
Navigating Compliance Hurdles in Iran's Oil Trade
Gasoline prices in the United States are primarily tied to the global Brent crude benchmark, which incorporates the price of all oil, including that which is unavailable due to sanctions. This happens through a complex gray market where oil is blended with cargoes from other nations or mislabeled on shipping manifests.
Since the Trump administration reinstated and expanded sanctions in 2018, the purchase of Iranian oil has become a violation of US federal law for entities operating under US jurisdiction. Geopolitical Tensions and Future Outlook.
Compliance Hurdles for Iranian Oil in the US Market
However, this is a reflection of market sentiment regarding a resource the US actively avoids, rather than a reflection of actual physical supply chains. The cost of bypassing sanctions, including insurance and logistics, makes Iranian oil uncompetitive.
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