The Trump administration said it won’t renew waivers that let countries buy Iranian oil without facing U.S. sanctions, a move that roiled energy markets and risks upsetting major importers such as China and India.

“This decision is intended to bring Iran’s oil exports to zero, denying the regime its principal source of revenue,” White House Press Secretary Sarah Sanders said in a statement Monday.

“The U.S., Saudi Arabia and the United Arab Emirates, three of the world’s great energy producers, along with our friends and allies, are committed to ensuring that global oil markets remain adequately supplied,” according to the statement.

Brent for June settlement on London-based ICE Futures Europe exchange climbed to $73.72 a barrel at 9 a.m. in New York, up 2.4 percent for the session. Prices briefly were up as much as 3.3 percent intraday, touching a new high for 2019.

The current set of waivers — issued to China, Greece, India, Italy, Japan, South Korea, Taiwan and Turkey — expire May 2.

“We will no longer grant any exemptions — we’re going to zero” and any nation continuing to buy Iranian oil will face U.S. sanctions, Secretary of State Michael Pompeo told reporters in Washington. He said the U.S., Saudi Arabia and the U.A.E. are “working directly with Iran’s former customers.”

Saudi Arabia and others in OPEC will more than make up the Oil Flow difference in our now Full Sanctions on Iranian Oil. Iran is being given VERY BAD advice by @JohnKerry and people who helped him lead the U.S. into the very bad Iran Nuclear Deal. Big violation of Logan Act?

— Donald J. Trump (@realDonaldTrump) April 22, 2019

The decision not to renew the waivers is a victory for National Security Adviser John Bolton and his allies who had argued that U.S. promises to get tough on Iran were meaningless with waivers still in place. Pompeo and his team had been more cautious, though they also maintained that the market was well-enough supplied to ramp up pressure on Iran.

“The maximum pressure campaign could not be maximalist until the administration cut off Iran’s oil exports,” said Mark Dubowitz, the chief executive officer of the Foundation for Defense of Democracies and a supporter of additional sanctions on Iran. “With this decision, Iran’s economy will be under severe pressure as its hard currency earnings dry up and its foreign exchange reserves plummet.”

Oil Markets

President Donald Trump’s efforts to cut Iranian supplies have rocked oil markets in the past year. After running up above $85 a barrel in anticipation of sanctions, oil plunged to near $50 in the last three months of 2018 as the administration unexpectedly granted the waivers.

For more on the U.S. Iran oil waivers: How U.S. Ending Iran Waivers Could Affect Oil Markets and Beyond Oil Jumps as U.S. Is Said to End Iran Waivers After May 2 Expiry Iran Oil Buyers Stay on Sidelines as Waiver Decision Looms Trump Team Divided Over Iran Oil Waivers as Deadline NearsChina, the largest buyer of Iranian crude, reiterated its opposition to unilateral sanctions on Monday and accused the U.S. of reaching beyond its jurisdiction. “China’s cooperation with Iran is open, transparent, reasonable and legitimate, and should be respected,” Foreign Ministry spokesman Geng Shuang said in response to a question on the waivers at a regular briefing in Beijing. Geng didn’t elaborate on how China would respond.

Japan and South Korea, two of the U.S.’s closest allies and long-time buyers of Iranian oil, said they were aware of the reports about the waivers but didn’t confirm the decision. Japan’s chief cabinet secretary, Yoshihide Suga, said Monday in Tokyo that the government had kept in close contact with the U.S. and expressed the view that “there should be no damage to the activities of Japanese companies.”

An Indian foreign ministry spokesman declined to comment when reached by phone Monday. State-run Indian Oil Corp. — the nation’s bigger refiner and top buyer of Iranian oil — has been lining up alternative suppliers since last year to hedge against the loss of crude from Iran, according to a company official.

Trump withdrew from the 2015 nuclear deal between Iran and world powers almost a year ago and revived a range of sanctions against Iran and any countries doing business with the Islamic Republic. But he and his top advisers have been wary of disrupting energy markets and spurring a hike in U.S. pump prices. For that reason, they allowed waivers for Iran’s biggest buyers of crude, including China, India and Turkey.

One person familiar with the decision announced Monday said that some of the countries that had previously received waivers would be given a little more time to wind down purchases. The person described that not as a waiver but more as a brief grace period.

Zero Exports

Bolton and officials in the Energy Department have argued that it’s time for the administration to make good on its desire to push Iran’s oil exports to zero. While Pompeo’s team, led by Iran special representative Brian Hook, cautioned that a sudden removal of Iranian crude from the market — about 1.1 million barrels a day — could fuel volatility and lead to a price spike.

“We certainly aren’t looking to grant any exceptions or waivers,” Hook said in an interview this month with Kevin Cirilli on Bloomberg Radio’s “Sound On.” Oil markets are better supplied this year than last, and that “puts us in a better position to accelerate the path to zero,” he said.

The administration had also faced growing pressure from Iran hawks in the Senate, including Ted Cruz of Texas and Tom Cotton of Arkansas, to cut waivers to zero.

The risk now is the decision could cause crude prices to spike just as Trump begins to gear up to campaign for a second term. His administration had been wary of doing anything that could push crude prices above $70 a barrel.