After the Trump administration pulled out of the Iran nuclear deal last year, the United States began to tighten its sanctions on the country. The measures, although not adopted by all nations, allow the United States to punish companies and countries that engage in trade with Iran. Some countries were initially granted waivers under the sanctions, but many have stopped buying oil from Iran to avoid the risk of being punished by the United States. As a result, Irans exports have plummeted.
The surge has changed the dynamics of the world’s oil market, which has long taken its cues from OPEC, the cartel of oil producers that includes Saudi Arabia, Venezuela and Iran. In previous eras, attacks in the Strait of Hormuz would have sent the price of oil spiraling down. The oil market’s response to the recent tanker attacks has been muted, in part because of how much oil now comes from the United States. As its reliance on Middle Eastern oil has decreased, the United States has found itself in a stronger position when dealing with countries like Iran.