Trump Administration Plans Temporary Waiver of Century-Old Maritime Law to Ease Energy Price Surge Pressure

Amid tense tensions in the Middle East and soaring international oil prices, the U.S. government is considering several measures to stabilize the energy market. Sources reveal that the Trump administration plans to temporarily waive a century-old maritime law to ease domestic fuel supply pressures and curb rising oil prices.

CITIC Securities Finance APP has learned that the U.S. government is preparing a 30-day temporary exemption for the Jones Act. This law requires ships transporting goods between U.S. ports to be built in the U.S. and operated by American crews. If the exemption is granted, foreign oil tankers will be allowed to participate in domestic energy transportation, helping to deliver fuel from the Gulf of Mexico and other U.S. regions to refineries on the East Coast.

Sources say this move aims to increase domestic fuel transportation capacity to alleviate the current energy price pressures caused by geopolitical conflicts.

Recently, due to the Iran conflict causing global energy supply tensions, both international oil prices and U.S. gasoline prices have surged significantly. To address market volatility, the Trump administration is evaluating various policy options.

This Wednesday, the U.S. announced the release of 172 million barrels from strategic petroleum reserves. This action is part of coordinated efforts with other countries, with a total release expected to reach 400 million barrels to increase global market supply and stabilize oil prices.

Waivers of the Jones Act are not new. The last time the U.S. issued a similar exemption was in October 2022, when foreign oil tankers were temporarily allowed to transport relief supplies to Puerto Rico after Hurricane Fiona.

Additionally, after a major fuel pipeline on the U.S. East Coast was targeted by a cyberattack in 2021, the Biden administration temporarily relaxed the law for refiner Valero Energy (VLO.US) to ensure stable fuel supplies.

Analysts believe that if this exemption is officially implemented, it will help improve domestic fuel transportation efficiency, ease regional supply tensions, and to some extent, suppress oil prices.