The US government plans to suspend the 1920 Jones Act in an attempt to tame rising oil prices amid the closure of the Strait of Hormuz, a critical passage through which much of the world’s oil supply passes.
According to people familiar with the matter, who were not authorized to discuss the development publicly, the Trump administration plans to issue a 30-day waiver for the centuries-old Petroleum Maritime Act.
According to the official document available on the US Customs and Border Protection website, the Jones Act, part of the Merchant Marine Act of 1920, stipulates that the transportation of goods between US coastal points, either directly or via a foreign port, is reserved for US-built, owned and documented vessels.
In simpler terms, it states that only US-built ships are approved for the transport of goods between US ports.
Its suspension will allow foreign vessels to help deliver fuel to the East Coast from the Gulf Coast and elsewhere in the United States
The development comes amid rising oil prices after Iran closed the Strait of Hormuz following the joint US and Israeli military strikes.
Iran has retaliated with missile attacks against Israel and the US bases in the Middle East.
The closure of the main oil trade route has already had several consequences for the global oil trade and economy.
Earlier, the International Energy Agency (IEA) announced the historic release of 400 million barrels of oil from its strategic reserves to address the shortage caused by supply disruptions.
