President Donald Trump issued a 60-day waiver of a long-standing U.S. shipping law in an effort to stabilize oil markets amid the Iran war, the White House confirmed to CNBC on Wednesday.
“The temporary suspension of the Jones Act will allow critical resources like oil, natural gas, fertilizer and coal to flow freely through U.S. ports for sixty days,” White House press secretary Carolyn Leavitt said in a statement.
“The Trump Administration is committed to strengthening our critical supply chains,” Leavitt said.
According to the Jones Act, signed by then-President Woodrow Wilson in 1920, goods transported between American ports must be transported by American ships.
The legislation was intended as an effort to develop the domestic shipping industry after World War I. The law has been criticized as protectionism and some economists have recently argued that it hinders domestic trade.
Trump’s two-month waiver was announced as oil prices resumed rising as a result of the US-Israeli war in Iran, where key energy infrastructure has come under attack and the Strait of Hormuz, a vital global oil-shipping route, has been effectively closed.
Prices of international benchmark Brent rose more than 6% to $109 a barrel on Wednesday morning. US oil prices were up 2.95% to trade at $99.05 per barrel.
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– CNBC spencer kimball Contributed to this report.