Trump might lift this obscure 100-year old law to relieve oil and gas price spikes due to Iran war
The Trump administration is weighing whether to temporarily suspend the Jones Act in order to move oil more quickly around the country as it works to lower rising gasoline prices.
White House press secretary Karoline Leavitt said the administration is reviewing the possibility of a short-term waiver of the law to help ensure that energy supplies and key agricultural products can reach American ports without delays. She noted that the decision has not yet been finalized but is being considered in the interest of national defense.
The Jones Act, a provision of the Merchant Marine Act of 1920, requires that cargo transported between U.S. ports be carried on ships that are built, owned, and crewed by Americans. In the past, the rule has occasionally been suspended during emergencies such as major hurricanes.
Discussion of a waiver comes as oil prices briefly climbed above $100 per barrel on Thursday. At the same time, the national average price of gasoline in the United States reached $3.60 per gallon, according to AAA. That is the highest level recorded since May 2024.
Energy suppliers have long argued that the Jones Act limits their ability to move goods efficiently, especially since the United States has a relatively limited domestic shipbuilding sector. If the law were temporarily waived, foreign tankers could transport oil to American refineries at a lower cost, which could help ease pressure on fuel prices.
Another possible option under consideration involves the East-West pipeline in Saudi Arabia. The roughly 1,200-kilometer pipeline was constructed decades ago to move oil over land and avoid shipping routes that could become blocked.
Energy analyst Javier Blas told Bloomberg News that the pipeline was built about 45 years ago with the concern that Iran might one day disrupt traffic through the Strait of Hormuz.
Rising fuel costs have become a political concern as the country approaches the November midterm elections, which will determine which party controls Congress. President Trump has attempted to reassure the public, saying the jump in prices is temporary. However, a Reuters/Ipsos poll indicates that most Americans expect gasoline prices to continue climbing. A separate Morning Consult survey found that 48 percent of respondents place responsibility for the situation on the president.
On Wednesday, Trump said gasoline prices were already beginning to fall significantly.
Officials in the administration have framed the recent increase as a short-term surge that could lead to longer-term improvements in national security.
Trump has also announced a plan to release 172 million barrels of oil from the Strategic Petroleum Reserve. In addition, countries that belong to the International Energy Agency have agreed to release another 400 million barrels collectively in an effort to stabilize global supply and push prices downward.
Concerns about disruptions in the Strait of Hormuz have contributed to the recent spike in oil prices. The narrow waterway off Iran’s coast handles about one-fifth of the world’s daily oil shipments and serves as the only maritime passage into and out of the Persian Gulf.
Shipping traffic there has been severely disrupted following Operation Epic Fury and retaliatory actions by Iran. Several vessels attempting to pass through the strait have reportedly come under attack.
President Trump said the United States could deploy military forces to protect commercial ships traveling through the area. Energy Secretary Chris Wright, however, said that step has not yet been taken.
Speaking to CNBC on Thursday, Wright explained that such a mission will likely happen soon but cannot begin immediately. He said current U.S. military efforts are focused on eliminating Iran’s offensive capabilities and the industries that support them.
Wright added that the U.S. Navy may be ready to escort oil tankers through the strait by the end of the month.
Meanwhile, Iran’s new leader, Mojtaba Khamenei, said Thursday that his government intends to continue blocking passage through the Strait of Hormuz.
About Post Author
