The Office of Foreign Assets Control (OFAC), within the U.S. Department of the Treasury, revoked General License X dated June 21, 2026, effective July 7, 2026, and issued General License X1 in its place. General License X1 provides a limited transition period for the purpose of "winding down and concluding" sanctioned transactions related to the production, delivery, and sale of Iranian-origin crude oil, petrochemicals, and petroleum products.
Revocation of General License X
Transactions previously authorized under General License X included, inter alia, those relating to the safe berthing and anchoring of vessels carrying crude oil, petrochemical products, or petroleum products; the protection of the health and safety of crew members on such vessels; emergency repairs and environmental mitigation or protection activities related to such vessels or stored crude oil, petrochemical products, or petroleum products; as well as services such as vessel operations, crewing, bunkering, piloting, registration, flagging, insurance, classification, and salvage services.
However, pursuant to paragraph (a) of General License X1, General License X dated June 21, 2026 has lost its validity as of July 7, 2026, and has been superseded in its entirety by General License X1. No new transactions may be conducted as of this date. On and after July 7, 2026, no new purchase or loading transactions may be carried out in connection with Iranian-origin crude oil, petrochemical products, or petroleum products.
Wind-Down Process
Wind-down transactions that are the ordinary consequence and a necessary part of transactions previously authorized under General License X are permitted until 12:01 a.m. (EDT) on July 17, 2026.
Transactions eligible for wind-down treatment must be solely of a complementary nature to existing authorizations. It must be underlined that General License X1 does not under any circumstances constitute a basis for authorization of new transactions.
Furthermore, unlike General License X, General License X1 requires that payments to blocked persons be deposited into a blocked, interest-bearing account held in the United States. The provision in General License X that permitted direct payment in U.S. dollars has been removed. This change requires particular attention from market participants operating in areas such as shipping, trade finance, and port operations with respect to payment mechanisms and bank selection.
Expressly Excluded Transactions
General License X1 expressly provides that no authorization is granted for transactions involving persons ordinarily resident in, or organized under the laws of, North Korea, Cuba, or certain regions of Ukraine (the “Covered Regions” under E.O. 14065 and the Crimea region under E.O. 13685), or entities owned, controlled by, or in joint venture with such persons, nor for any transaction prohibited under any sanctions program or executive order other than those expressly specified in the text.
General Assessment
General License X1 provides an extremely short and strict transition window (July 7–17, 2026) for the orderly closure of transactions previously initiated under General License X that have not yet been completed. This requires parties involved in such processes to urgently evaluate the following critical points:
Transition timeline: Transactions entering the wind-down process must be closed by July 17, 2026. Transactions conducted after this date will constitute sanctions violations.
Prohibition of new transactions: As of July 7, 2026, no new purchase or loading transactions may be carried out under General License X.
Payment mechanism: The requirement to direct payments into blocked, interest-bearing accounts in the United States may necessitate a restructuring of the payment chain and correspondent banking relationships.
The General License X1 document can be accessed
here.
Aslı Kınsız, Managing Associate
Selen Akgün, Associate