In response to skyrocketing fuel and fertilizer prices following the U.S. war against Iran in February, President Donald Trump issued a waiver of Section 27 of the Merchant Marine Act of 1920, commonly known as the Jones Act. The Jones Act requires cargo moving between American ports to be transported on ships built, owned, and crewed predominantly by Americans.

The waiver, initially set for 60 days, was extended by Customs and Border Protection for an additional 90 days, postponing its expiration until mid-August. This extension has allowed companies to ship goods between U.S. ports without restrictions on the ship's origin or flag.

According to reporting by Alana Pipe and Ryan Dezember in The Wall Street Journal, more than 31 million barrels of fuel and chemicals were transported by foreign vessels during the 90-day waiver period. Over 70% of these shipments originated from the Gulf Coast, which houses more than half of U.S. refining capacity and numerous petrochemical and fuel-export facilities. The most frequent destination has been California, a state reliant on Persian Gulf imports and known for having the highest gasoline prices in the country. Gasoline shipments to California have come from refineries in Texas, Louisiana, and Washington.

The waiver has also reactivated long-dormant U.S. energy supply chains. However, the Jones Act remains controversial; 52 Republican lawmakers, including House Speaker Mike Johnson and House Majority Leader Steve Scalise, recently urged President Trump to let the waiver expire, describing the Jones Act as "our nation's strongest shield against foreign exploitation of American waterways."

Critics note that despite over a century of protection under the Jones Act, American shipyards have not produced a surplus of new ships, suggesting limited industry efficiency.

Sources:

  • Reason (Joe Lancaster)
  • The Wall Street Journal (Alana Pipe and Ryan Dezember)