Trump extends shipping waiver, with limits, to aid energy flow

Washington, August 11 - President Donald Trump has once again extended a waiver, this time with limitations, to facilitate the movement of oil and other commodities between US ports amid the ongoing war on Iran, which has disrupted energy flows and caused prices to rise. The 90-day extension of the relief from the Jones Act, a law that mandates the transport of cargo between US ports on US vessels, is set to begin shortly before the previous waiver was set to expire.

However, the current waiver is more narrowly focused on energy transportation, according to a White House spokesperson.

White House spokeswoman Taylor Rogers announced the 90-day extension, stating that it aims to ensure uninterrupted access to critical resources for the military and key industries. Data suggests that the waiver has significantly increased the domestic delivery of essential products like gasoline, diesel, and jet fuel. The White House also mentioned that the waiver requires periodic reviews to determine if individual voyages are eligible.

Colin Grabow and Scott Lincicome from the Cato Institute estimate that over 54 million barrels of energy products have been transported between US ports on more than 200 voyages since March, following the introduction of an earlier waiver. They argue that the waiver has stimulated domestic commerce that the Jones Act had previously hindered.

Most of these voyages occurred on vessels with no ties to US adversaries such as China, enabling American companies to obtain American energy products at a lower cost compared to imported alternatives.

The escalation of the war began with US and Israeli strikes on Iran in late February, prompting Tehran to virtually close the Strait of Hormuz, a vital waterway for global energy transit. In response, oil prices have surged, putting a strain on American households as the midterm elections approach. The Jones Act, enacted in 1920, aimed to boost American shipbuilding by mandating that cargo transported by water between US ports must be carried on vessels built, owned, and registered in the United States.

The Trump administration granted a 60-day waiver in March and extended the relief in late April as the economic impact of the conflict continued. As of now, efforts to negotiate an end to the war and reopen the Strait of Hormuz have proven unsuccessful.