Curbs on Tehran oil lifted temporarily, payment in dollars

The US has temporarily opened the door for Iranian oil sales and dollar-denominated payments, marking the first major sanctions relief for Tehran since President Donald Trump reimposed sweeping curbs in 2018.

The US Treasury Department’s Office of Foreign Assets Control (OFAC) has issued General License X, authorising transactions related to the production, sale, transportation and offloading of Iranian crude oil, petroleum products and petrochemicals through August 21, 2026.

The licence allows transactions ordinarily required for the sale and delivery of Iranian oil and petrochemicals, including shipping, insurance, vessel management, docking and emergency repairs.

The department also authorised payments owed to Iran for such purchases to be made in US dollar-denominated funds, allowing Tehran access to the global currency at a time when Washington’s sanctions regime had largely isolated the country from the international financial system.

The temporary waiver is expected to facilitate the return of Iranian crude to international markets and ease concerns over global energy supplies amid continuing tensions in West Asia.

The decision appears to align with commitments undertaken under the Islamabad Memorandum, which envisages measures relating to Iran’s oil exports and the release of frozen Iranian assets as part of the broader peace process.

Iranian Foreign Minister Abbas Araghchi had earlier said mediation efforts by Pakistan and Qatar had delivered “major progress” and that restrictions on Iran’s oil and petrochemical exports had been lifted while some frozen assets had been released.