By Timothy Gardner
On June 16, a senior U.S. official announced that the U.S. will permit Iran to start selling oil and fuel immediately following a memorandum of understanding aimed at ending the ongoing conflict. This agreement, expected to be signed this week, also includes provisions waiving sanctions on Iranian oil sales and facilitating necessary services like banking, transportation, and insurance.
The U.S. official emphasized that the memorandum is performance-based, meaning Iran must adhere to all agreed-upon terms, which include commitments against nuclear armament, management of enriched materials, and maintaining navigation freedom in the Strait of Hormuz. This strategic channel is crucial, as it accounts for 20% of global oil and gas transport.
Under President Donald Trump’s administration, sanctions had been re-imposed on Iran in 2018 due to concerns around its nuclear program and regional militant support. Analyst Brett Erickson characterized the latest U.S. concession as a multibillion-dollar financial benefit for Iran, which has over 100 million barrels of oil ready for sale, with significant quantities outside the U.S. blockade.
According to a senior Iranian official, this draft agreement will allow Iran to sell oil and earn revenue over a defined period, with all U.S. and U.N. sanctions to be lifted per a predetermined timetable.
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