The Trump administration on Monday narrowed its waiver of the Jones Act while extending it for another 90 days, keeping fewer U.S. shipping restrictions in place as the Iran war keeps rattling global oil markets and pushing fuel politics into the middle of the midterm election season.
Who Gets to Move the Fuel
The White House said the latest extension will apply only to vessels hauling certain energy resources, and a White House official told CNBC that the Pentagon will have to consult with the U.S. Maritime Administration and decide whether the waiver applies to each individual shipping voyage. The official said the new limits were added to address concerns from the U.S. maritime industry. That’s the machinery of control at work: a 1920 law, a Pentagon review, a shipping bureaucracy, and a war economy all grinding over who gets to move fuel and under what terms.
President Donald Trump's second extension of the waiver comes after he first issued a 60-day waiver on March 17, less than three weeks after the U.S. and Israel started the war by launching heavy strikes on Iran. The administration extended the waiver again in mid-May for another 90 days. The newest extension should last until mid-November, past the date of the midterms. Ordinary people are left to absorb the fallout while the state adjusts the rules to keep the supply chain from choking on its own violence.
Kristin Whitman, senior vice president of government relations at the American Petroleum Institute, praised the move in a statement, saying, "We commend the administration's leadership in extending the Jones Act waivers, a critical action that will keep American energy moving, strengthen supply security and help protect consumers from unnecessary price volatility." She added, "This decisive step will ensure critical fuels reach the regions that need them most while reinforcing America's resilience amid ongoing global market disruptions." The language is polished, but the message is plain: the energy industry wants the state to smooth the path for profit and circulation while everyone else is told to call it resilience.
What the Waiver Really Serves
The Jones Act is a 1920 law requiring that goods transported between American ports be carried by U.S. vessels. It was intended to grow the domestic shipping industry after World War I. Some economists, including those at the libertarian Cato Institute, argue the law is outdated protectionism. Since Trump first waived it, 210 voyages have been completed that otherwise would have been unlawful, according to Maritime Administration data. The majority of those vessels were hauling gasoline and crude oil. Cato, citing that data, calculates that nearly 55 million barrels of cargo in total have been shipped by using the waivers.
White House spokeswoman Taylor Rogers said the administration took the step "to ensure our military and key industries maintain uninterrupted access to critical resources." Rogers said, "Data shows the waiver has driven a significant increase in domestic deliveries of essential products such as gasoline, diesel, and jet fuel. President Trump continues to take bold, commonsense action that protects and strengthens America's economic and national security." The state calls it commonsense. The people living through the price swings, the war, and the shipping restrictions get a different bill.
Oil prices jumped about 5% Monday as doubt grew that the U.S. and Iran will reach a deal to increase ship traffic through the Strait of Hormuz. U.S. West Texas Intermediate futures climbed about 5% to close at $82.13 per barrel. Brent crude, the international benchmark, also settled around 5% higher at $87.72 a barrel. Markets reacted fast. The costs land slower, and lower.
War, Blockade, and the Theater of Negotiation
President Donald Trump told Axios on Sunday that the U.S. is "only semi-negotiating" with Iran, after he insisted last week that Washington and Tehran were in fact holding talks. Trump said he would rely on the U.S. naval blockade to pressure Tehran rather than another wave of airstrikes. He said, "We are just watching Iran with its huge inflation and the fact they have no money." That’s the language of siege dressed up as diplomacy.
Trump canceled a planned attack against the Islamic Republic on Aug. 1 to allow for negotiations. Iran's Foreign Ministry spokesman, Esmail Baghaei, said Monday that the U.S. must lift its blockade before Tehran would agree to fully open Hormuz. Baghaei said, according to the state news agency Tasnim, "As long as the U.S. naval blockade continues, the necessary conditions for the reopening of the Strait of Hormuz do not exist." He said Iran and Oman are holding bilateral negotiations over shipping routes in the strait.
The U.S. and Iran signed a memorandum of understanding on June 17 to open Hormuz to commercial ships, but the deal quickly collapsed as fighting erupted over which routes vessels could use. Iran launched multiple attacks on tankers transiting Hormuz along Oman's coast under U.S. military protection. Tehran demanded that ships sail through its territorial waters when transiting the strait. The U.S. staged multiple waves of airstrikes and reimposed its naval blockade in retaliation for the tanker attacks.
Trump often boasts that the U.S. naval blockade on Iranian ports has crippled the country economically. He told Axios Iran "is in very bad shape" as a result of the blockade. In an Aug. 10 post on Truth Social, Trump countered Iran's demand for financial compensation by saying he's "likewise demanding compensation from Iran" for all the people killed or injured by Iranian attacks over the years. He said Iran should also compensate families of innocent protesters killed by the Iranian regime over the past half-century. Trump wrote, "I have instructed my representatives to put this firmly into any, and all, future negotiations."
Trump's position marked a major shift from Aug. 3, when he warned Iran he was giving it one final opportunity to agree to a peace deal or risk "decapitation." At the time, Trump said he decided to hold off on ordering what would have been "the biggest attack since World War II" at the request of Saudi Arabia, the United Arab Emirates and Qatar. He later said, "It will work out. It always works out. It's like a chess game," referring to the back-and-forth with Iran.
The White House also said Trump was aboard Air Force One as he left a NATO summit, but The Washington Post reported that his departure included an elaborate ruse that concealed his travel. The Post said an Iranian assassination threat against President Donald Trump prompted an extraordinary operation last month in which he flew secretly from Turkey on an alternate military aircraft while the White House said he was aboard Air Force One. Even the president’s movements were wrapped in secrecy, with military hardware and official cover doing the hiding.