Trump weighs Jones Act waiver amid rising fuel prices, White House says

The Trump administration is considering waiving the Jones Act to ease shipping rules amid the ongoing Iran war, the White House announced. The Jones Act, a century-old statute, mandates that goods transported between U.S. ports must be carried on ships that are U.S.-built, U.S.-flagged, and U.S.-crewed, limiting the use of foreign tankers by domestic shippers.

The potential waiver of the Jones Act is being contemplated in the interest of national defense to ensure the uninterrupted flow of essential energy products and agricultural supplies to U.S. ports. While this decision has not been finalized, experts believe that allowing foreign ships to transport fuel between U.S. ports could help alleviate supply disruptions and potentially lead to a reduction in energy prices.

The escalation of tensions following the U.S. and Israel’s attack on Iran on February 28 has caused oil and gas prices to soar. Brent crude, which was around $60 in early January, surged by 8% on Thursday, briefly exceeding $100 per barrel. Similarly, West Texas Intermediate, the U.S. benchmark, spiked by nearly 9% to $95.02 per barrel.

Despite efforts by the Trump administration and the International Energy Agency to inject a total of 400 million barrels into global energy markets to stabilize oil supply, energy costs continue to rise. Gas prices, which are closely tied to the price of oil, taxes, and seasonal factors, reached $3.60 per gallon on Thursday, marking a 60-cent increase since the onset of the conflict.

As the situation unfolds, it is crucial to monitor the impact of these developments on energy markets, consumer prices, and the overall economy. The decision to potentially waive the Jones Act underscores the administration’s commitment to ensuring the smooth functioning of critical supply chains during times of heightened geopolitical tension.

Edited by Alain Sherter and Aimee Picchi.