Oil prices jump 5 percent after U.S. revokes Iran oil sanctions waiver

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Oil prices on Tuesday jumped more than 5 percent after the U.S. revoked its waiver on Iranian oil sanctions following strikes on three commercial vessels near the Strait of Hormuz.

International Brent crude oil jumped nearly 5.5 percent to more than $75 per barrel as of Tuesday evening.

A U.S. official previously told The Hill that the memorandum of understanding (MOU) intended to pause hostilities between the U.S. and Iran “is entirely performance-based.”

“Iran will only reap benefits if they exhibit good behavior,” the official said. “Iran’s actions in the strait were wholly unacceptable to the United States and will be met with consequences.”

The price increase comes after the Treasury Department issued a new document stating that transactions that were authorized under its previous sanctions waiver would have to wind down by July 17. The waiver would have previously allowed sales of Iranian oil through Aug. 21. This waiver was part of the MOU.

Kazem Gharibabadi, Iran’s deputy foreign minister, said revoking the waiver violated the MOU. He accused the U.S. of repeatedly violating the memorandum “due to the actions of the Zionist regime in Lebanon and threatening statements against Iran,” referring to Israel defiantly keeping its military in Lebanon and not withdrawing troops.

“Iran, while issuing a serious warning regarding the consequences of America’s breach of the agreement, will take decisive actions to safeguard its national interests and security,” he wrote on the social platform X.

The attacks on the three ships prompted U.S. Central Command to launch attacks back at Iran on Tuesday after the U.K. Maritime Trade Operations, which is affiliated with the British Royal Navy, said on Monday a commercial tanker caught fire after being struck by a projectile.

Qatar also blamed Iran for an attack on Al-Rekayyat, a Qatari liquified natural gas vessel, and accused the regime of violating international law.

Iran has held a massive funeral procession across several cities as mourners lay to rest former Supreme Leader Ayatollah Ali Khamenei, who was killed in the U.S.-Israeli airstrikes on Iran at the end of February.

The Islamic regime has asserted its control over the strait, a critical chokepoint between the Persian Gulf and the Gulf of Oman that carries roughly 20 percent of the global oil and gas exports.

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Ali Khamenei

Ayatollah Ali Khamenei

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