The United States will allow Iran to immediately resume oil and fuel sales under a proposed agreement aimed at ending the recent conflict, offering Tehran an early economic incentive while potentially boosting global crude supplies and easing energy prices.
According to people familiar with the agreement, waivers on U.S. sanctions targeting Iranian oil exports will take effect as soon as the deal is formally signed this week. The waivers will also cover essential services such as banking, shipping and insurance, enabling Iran to re-enter international energy markets through legitimate channels.
The move could mark the most significant easing of restrictions on Iran's energy sector since Washington withdrew from the 2015 nuclear deal in 2018.
Iran, which produced an average of around 2.33 million barrels per day (bpd) of crude oil as of May 2026, has seen output and exports affected by regional conflict and tighter maritime restrictions. At current production levels, the country is capable of producing nearly 850 million barrels of crude annually.
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While Iran never completely stopped exporting oil, most of its sales since 2019 have taken place through unofficial or "shadow" trade networks after the U.S. ended sanctions waivers and tightened enforcement measures. Before sanctions were fully restored, Iran was exporting more than 2 million bpd to international buyers, including India.
A sign that restrictions may already be easing emerged on Tuesday when advocacy group United Against Nuclear Iran said an Iranian supertanker carrying crude departed the port of Chabahar, crossed the U.S. blockade and entered the Gulf of Oman with its location tracker switched on — the first such publicly visible voyage since the blockade began in April.
The memorandum of understanding, electronically signed by Washington and Tehran on Sunday and expected to be finalized later this week, includes a prolonged ceasefire, the lifting of U.S. and Iranian blockades in the Strait of Hormuz, and a framework for broader negotiations over Iran's nuclear programme.
However, a senior U.S. official said long-term sanctions relief would depend on Iran's compliance with American demands, including maintaining open navigation through the Strait of Hormuz and addressing concerns related to its nuclear activities.
In a briefing on Monday, senior Trump administration officials confirmed discussions on sanctions relief, access to frozen Iranian assets estimated at nearly $100 billion, and a proposed $300 billion reconstruction fund to help repair war-related damage.
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Allowing Iranian oil exports to resume could prove politically easier than directly releasing frozen assets, while simultaneously helping contain global energy prices.
For India, the development could reopen an important source of crude supply. India stopped importing Iranian oil in May 2019 after U.S. sanctions took effect, ending a relationship under which Iran accounted for roughly 10-12% of India's crude imports. According to NDTV, India briefly resumed purchases in April 2026 under a temporary U.S. waiver amid disruptions in the Strait of Hormuz, importing an estimated 4-9 million barrels before the exemption expired.
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