Washington, DC – The Trump administration is seriously considering granting an additional waiver to the Jones Act, which restricts shipping rights between domestic ports to U.S. vessels, according to Reuters.
The proposed plan aims to allow more foreign ships to transport fuel to the United States.
It also seeks to mitigate the sharp rise in gasoline prices caused by soaring global oil prices amid the ongoing war with Iran.
President Trump initially suspended the application of the 1920 law for 60 days on March 18,
following the outbreak of the war with Iran. He then announced a further 90-day extension in late April.
The suspension is set to expire on March 16. This would mark the longest period in US.
history that the Jones Act has not been applied.
Expert opinions and market challenges
In this context, Bob McNally, president of the US energy consulting firm Rapidan Energy Group,
explained that granting a waiver from the Jones Act is one of the few practical measures
available to the Trump administration to mitigate the burden of high oil prices.
He pointed out that even if Saudi Arabia were pressured to immediately increase crude oil production,
export routes would remain restricted due to the closure of the Strait of Hormuz.
Furthermore, he asserted that alternative measures discussed internally,
such as imposing a “booms tax” on oil companies or setting controls on gasoline prices, remain unrealistic options.
McNally predicted that even if the suspension of the Jones Act is extended,
its impact will be limited to reducing the price of gasoline,
which has risen from an average of $3 per gallon before the war to its current level of $4, by only a few cents.
Opposition from the shipping sector and political pressures
Given these limited prospects and amid strong opposition from the US shipping industry
and its associated workers, there is widespread skepticism within US.
political circles about the wisdom of extending the Jones Act suspension.
In the same vein, Jennifer Carpenter, president of the US Shipping Partnership,
argued that previous exemptions under the Jones Act have weakened the foundations of the domestic shipping industry.
Furthermore, routine domestic trade has been diverted to foreign operators, including companies linked to China and Russia.
It is also worth noting that Republican members of the House of Representatives, led by Speaker Mike Johnson,
sent a letter to President Trump last month, urging him not to extend the suspension of the Jones Act.
