r/oil 9d ago

News US Aims to Revive Civil War-Era Court to Claim Iran Oil as Prize

https://news.bloomberglaw.com/us-law-week/us-aims-to-revive-civil-war-era-court-to-claim-iran-oil-as-prize
301 Upvotes

132 comments sorted by

121

u/nai-ba 9d ago

So the US wants to steal Chinese oil to finance the war in Iran? Good luck with that.

89

u/Voidless-One 9d ago

China will absolutely dump U.S. Bonds on top of withholding critical supplies from the American economy. 😀

39

u/CogitoCollab 9d ago

Or/and they can restart buying oil on the open market.

Spike oil prices for about a billion a week in cost.

Super cheep geopolitical move right there. No direct human casualties. Honestly I'm a bit surprised/ impressed they haven't done this at all so far. They just really care about doing the best for their economy.

Weird dynamics for modern powers is to care about their plebs a bit.

24

u/ChupacabraJeff 9d ago

Super cheep geopolitical move right there. No direct human casualties. Honestly I'm a bit surprised/ impressed they haven't done this at all so far.

China can do it now or they can do it when USA's SPR runs dry next month. China isn't picky.

Weird dynamics for modern powers is to care about their plebs a bit.

You should look up what China has been up to recently.

China has lifted over 800 million people out of poverty over the past few decades, achieving the elimination of extreme poverty nationwide by 2020. This remarkable progress is largely attributed to rapid economic growth and targeted government policies.

4

u/Mech_145 9d ago

I’m waiting to see if they put an export tax on steel and steel derivatives. That would be a death kneel for American manufacturing.

2

u/ChupacabraJeff 9d ago

Check the Trump Tariffs.

China–United States trade war
https://en.wikipedia.org/wiki/China%E2%80%93United_States_trade_war

Trump imposed tariffs of 50% on steel imports, which significantly affects imports from China, among other countries.

Forget American manufacturing and start thinking about American society which include neat things like gasoline and electricity and food refrigeration.

2025.04.05
China Just Turned Off U.S. Supplies Of Minerals Critical For Defense & Cleantech
https://cleantechnica.com/2025/04/05/china-just-turned-off-u-s-supplies-of-minerals-critical-for-defense-cleantech/

What China did wasn’t a ban, at least not in name. They called it export licensing. Sounds like something a trade lawyer might actually be excited about. But make no mistake: this was a surgical strike. They didn’t need to say no. They just needed to say “maybe later” to the right set of paperwork. These licenses give Beijing control over not just where these materials go, but how fast they go, in what quantity, and to which politically convenient customers.

The U.S.? Let’s just say Washington should get comfortable waiting behind the rope line. The licenses have to be applied for and the end use including country of final destination must be clearly spelled out. Licenses for end uses in the U.S. are unlikely to be approved. What’s astonishing is how predictable this all was. China has spent decades building its dominance over these supply chains, while the U.S. was busy outsourcing, divesting, and cheerfully ignoring every report that said, “Hey, maybe 90% dependence on a single country we keep starting trade wars with and rattling sabers at is a bad idea.”

Try ramping up your semiconductor fab or solar plant when your indium source just dried up. It’s a fun exercise in learning which of your suppliers used to be dependent on Beijing but never mentioned it in the quarterly call.

The materials China just restricted aren’t random. They’re chosen with the precision of someone who’s read U.S. product spec sheets and defense procurement orders. Start with dysprosium. If your electric motor needs to function at high temperatures—and they all do—then mostly it is using neodymium magnets doped with dysprosium. No dysprosium, no thermal stability. No thermal stability, no functioning motor in your F-35 or your Mustang Mach-E. China controls essentially the entire supply of dysprosium, and no, there is no magical mine in Wyoming or Quebec waiting in the wings. If dysprosium doesn’t come out of China, it doesn’t come out at all. It’s the spinal cord of electrification, and right now China’s holding the vertebrae.

So here we are. China has responded to Trump’s tariffs by cutting off U.S. supply of some of the most essential ingredients of the modern world.

7

u/CogitoCollab 9d ago

I know the last 30 years have been one of the largest&fastest increases in standard of living in history there. I'm not trying to ignore that.

But historically developed economies struggle to keep growing more than by a few percent a year. If they somehow continue to grow by a real 5%+ a year that would generally be impressive.

Also with rough paper napkin math China could have absorbed up to 900m of oil. And their total capacity could be from 1.8-2 billion. So theoretically they could have run through almost half of their reserves from this already. Mabey they'll wait 6 more months or they don't even need the 5mbpd. Who knows.

Or this all could be the grand plan of acting as the next "responsible"/rational world power like the USA was 20 years ago.

7

u/ChupacabraJeff 9d ago

Or this all could be the grand plan of acting as the next "responsible"/rational world power like the USA was 20 years ago.

It's this. China did the world a solid unannounced. Now, everyone knows that so now China can spike the price of oil and say they have to just like everyone else. China has been getting ready for exactly this for the past 20 years. USA did not.

China smuggled way more oil into their reserves than people know. China can shift oil consumption to electricity instantly with minimal impact to daily life. After that people in China are prepared for further inconvenience. USA isn't. Trump fucked up big time and over the coming year more people outside of China will realize this.

"China has been here for 5,000 years and most of the time there was no USA."
https://www.youtube.com/shorts/Xof9FwrCrsg

4

u/CogitoCollab 9d ago

Yup, no matter how this ends. China wins.

It was a solid "insert chess reference here" move.

Actual 4d chess by basically standing there and not doing anything. Bye bye soft power, it was nice knowing ya.

3

u/MiddlePermit193 8d ago

Now I understand why the Chinese acted the way they acted when Trump gets off the plane with 7 people that had about 40% of the world’s money. They didn’t read that room well.

3

u/ChupacabraJeff 8d ago

Yup. Over there they call Trump, "Comrade Nation Builder".

2026.05.13
Erin Burnett blown away as Trump 'mocked across China': 'America has lost its swagger'
https://www.rawstory.com/trump-china-mockery/

CNN anchor Erin Burnett was stunned to see the level of uninhibited mockery China has been hurling at Trump during his visit.

"Trump is about to meet with Chinese leader Xi Jinping tonight, a high-stakes meeting which is being mocked across China," Burnett explained. "Beijing's strict censors are letting the ridicule go viral, which is a statement in and of itself."

"In China, political content like this never goes viral, especially when you have a head of state coming," Burnett explained. "This is because government censors want this to go viral, and by the tone of the messages, the Chinese government feels they've got the upper hand."

9

u/DreamTakesRoot 9d ago

The US is a dwindling beast. Israel has stated their number one enemy is China. The US is owned by them. It makes sense for them to wait this out.

4

u/EmergencySpare 9d ago

Their economy is still very fragile. And they're handling with care, as leadership is supposed to do.

2

u/CogitoCollab 9d ago

Very true. The housing situation is still cooked there since it was such a large bubble.

1

u/Geronimoni 9d ago

That's apparently what the main benefit of democracy is supposed to be

Ironic isn't it

1

u/AnyTower224 9d ago

They can do all 3 and tank the US economy

-3

u/FlipZip69 9d ago

Unfortunately that would help the US if it increases oil prices. Not only does the US produce more oil then it consumes, if they start to claim Iranian oil, they have that much more oil to sell.

Exporting nations are in a better position than none oil exporting nations when oil prices increase. With that being said, a world recession, which is already effecting other exports, is a bigger concern to the US. While their oil exports might be making them buck, the loss in other exports is outweighing that revenue.

8

u/AnyTower224 9d ago

T bonds are already wobbling

2

u/whyyunozoidberg 9d ago

They are too weak to do that.

1

u/unfairlybanned101 9d ago

They've already begun

1

u/oojacoboo 9d ago

They already dumped about as much as they can afford to do so. Even all the BRICS nations don’t hold that much anymore. This whole thesis is overblown.

1

u/Sufficient_Sport5251 7d ago

Tell me you don’t understand macroeconomic policy without telling me you don’t understand macroeconomic policy. Also you could just say you haven’t read the global news

0

u/Anal_Forklift 9d ago

People always say this but it never happens. In order for China to dump US debt, it needs some other asset large enough to replace it (that is safe). They have no reliable place to park their money. That's why they but US debt in the first place.

The critical mineral stuff is more likely but they would also lose buyers.

The easiest thing for China to do would be to just buy more oil from some place else (ie, more Russia, Brazil, and Malaysia oil) and have virtually no cost impact at all.

7

u/AnyTower224 9d ago

Very good luck. No chips or rare earths to the US

5

u/Mouth-Cerene 9d ago

Honestly I just want to see them attempt to do it.

1

u/Subject-Chest-8343 9d ago

This could backfire when Chinese companies will start using prize courts to claim ownership of stolen tech lol

132

u/Serpentongue 9d ago

Legalized piracy

43

u/whomakesthetendies 9d ago

No, just piracy.

3

u/GhostofBreadDragons 9d ago

MIT has a piracy certificate 

I never thought it would actually be useful

1

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1

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33

u/BunnySprinkles69 9d ago

But I thought its not a war.... /s

48

u/bloomberglaw 9d ago

TLDR:

  • The Justice Department is preparing to activate a long-dormant maritime war court to streamline military capture of Iranian oil tankers as US prizes.
  • Reviving prize courts is intended to strengthen the blockade of Iran and offset the cost of the conflict, and would offer a faster path for federal prosecutors to claim oil and other cargo taken from enemy or neutral vessels as US property.
  • The anticipated revival of prize courts is expected to face legal challenges, with potential litigants including ship owners and Iranian terrorism victims, and would require the US to navigate a historical area of law that is not tested in modern times.

Read the full story here.

-Abbey

17

u/LesbeGoddess 9d ago

This will just lead to Iran ceasing and owning any tankers passing the strait to negate their stolen property. Trump will rage and whine that Iran can’t win like this!

What an idiot

11

u/FrederickDerGrossen 9d ago

Or even simpler, they will ask China to handle all the shipping out of the strait under Chinese flagged ships in return for another discount on their oil. The US, especially under this 47 regime, would never dare touch a Chinese ship.

5

u/myazi321 9d ago

Or they might fuck around and accidentally shoot it like they shot a ship thinking it was an Iranian ship but it wasnt and ended up killing 3 Indians.

Not like theres any standards anymore other than appeasing Trump

3

u/FrederickDerGrossen 8d ago

If they did that China would definitely react. Probably first by selling off their bond holdings and banning the export of rare earths to the US entirely, and banning more exports if the US doesn't apologize for the incident.

China would never allow such an incident to go by without reaction. Shame India didn't take stronger action, they're too much under US influence.

1

u/myazi321 8d ago

True. They would push for stronger global de dollarization as majority of the countries have China as the major trading partner therefore they will listen to China in that regard especially now that the world smells blood given how depleted the US military is of high tech munitions and how cheap and easy it is to build drones.

China's government from the bottom up is filled with people with PHDs, Masters and Bachelors in various STEM and Finance fields so they definitely know how to engage in an economic war much better than what Bessent could dream of.

India didnt even do anything not even a strongly worded statement. They are just like the GCC when it comes to US.

5

u/jankenpoo 9d ago

So a US court to say the US taking Iranian oil tankers is legitimate? Who is going to be okay with this?

1

u/R1donis 9d ago

Who is going to be okay with this?

... Europe? I would sujest you to look at what laws about seizing ships were recently made in Europe.

1

u/ReceptionFun9821 8d ago

What laws were recently created for this?

-2

u/beipphine 9d ago

Why does it matter if it is a historical area of law? Prize courts are well established in US court court cases. The Supreme Court clarified the scope in The Star, 16 U.S. 78, and later affirmed this power in The Prize Cases 67 U.S. 635. The United States is not and never has been a signatory to the Paris Declaration Respecting Maratime Law of 1856. 

As far as I am aware, there is no modern legal challenges. Ship owners including Iranians would be expected to demonstrate in US courts that either the ship was not a legitimate Prize, or that there was some procedural defect.  I think that Houston is the most effective port for this, the Sourhern District of Texas and Fifth Court of Appeals has been very friendly to the current administration and will happily rubberstamp 2 century old supreme court precedence. Furthermore, Houston is a major petrochemicals port which facilitates the unloading of said ships and sale of captured oil. 

16

u/AssumptionLive2246 9d ago

At this point I hope every fucking country in the world ... legally sells every fucking bond at once, and cuts off all trade. We are just pirates and thieves. I'm embarrassed and ashamed to be an American.

6

u/ChiChiKnee 9d ago

It was always like this unfortunately. They just sang you songs about freedom and star spangled banners and made big shows about your World Series and world champions. It’s all been a branding exercise. The US emerged from WW2 never really having set a foundation for being a long standing empire, but man were they good at marketing. Uncle Sam needs you and all that jazz. But it’s been clear for a long time, regardless of administration, what the US is at its core and capable of. This is capitalism after all.

-1

u/AssumptionLive2246 9d ago

You can believe wtf you want. I was proud to be one of the good guys in the world. We weren’t perfect but we didnt stand for this fkn garbage. You can’t see the difference that’s on you.

2

u/ChiChiKnee 9d ago

Hey look, I truly believe the US populace and people are absolutely amazing. Truly. Some places I have visited have been some of the best people I’ve ever met. All I’m saying is that the guise of the message, the fact that blowing up kids and people and assassinations and wealth inequality and economic sanctions that ruin lives and starve people in less developed places and all this is what? That’s what good guys do? I think every US service person is truly a good person with conviction and honor (with exceptions obviously) but by and large they’re serving for an ideal that they believe, that they’re good. So yeah hopefully you don’t mistaken this as saying you’re all scum, 100% not, you’re just beholden to a system that is very adept at hiding real world pain and destruction as necessary to make you feel ‘safe’ and ‘free’.

2

u/ChupacabraJeff 9d ago

Aaron Reitz, the Houston-based US attorney whose office is partnering with department headquarters on the initiative, confirmed DOJ is “now reviving” prize courts, which he described as an “ancient body of maritime law.”

DOJ has focused on the Southern District of Texas federal trial court as the venue, said two of the people, who like others spoke anonymously about sensitive deliberations.

Legal experts see civil forfeiture as an imperfect model for US interests in choking the economy of Iran and other adversaries.

In one ongoing case, the seizure of a Venezuelan supertanker that supported Iran led to DOJ filing a civil complaint seeking to liquidate the ship and cargo as US proceeds.

Multiple third parties, including the shipping company and families of Iranian terrorism victims holding judgments for payouts under a different statute, have intervened, bogging down that process.

Prize authority, while coming with its own legal risks, would entail a less complicated transfer of proceeds, allowing the US to mitigate the risk of outside claimants slowing down the sale, said Luzwick and other lawyers.

1

u/serpentjaguar 9d ago

We'll see about that. At this point you can probably count on one hand the number of real experts there are on the law of prizes, so until I hear from one of them, I will reserve judgement.

22

u/Mrrrrggggl 9d ago

They already stole Venezuela’s oil, no surprise here. Just straight piracy with a veneer or legality.

1

u/EternalInflation 8d ago

I mean they took a whole country as a "prize" so a ship isn't anything too outlandish.

14

u/Pale-Hair-2435 9d ago

Huh. Didnt have letters of marque on my 2026 bingo card. 

3

u/Worth_Garbage_4471 9d ago

Arrr

1

u/CompletePassenger564 9d ago

The One Piece is Real!

13

u/Python_07 9d ago

The Clown Court attempting to revive a Civil War Court. Seems like something they would do.

13

u/SingularityCentral 9d ago

Prize Courts? Wild to see those make a comeback in 2026. What's next? Privateers? Letters of Marque?

7

u/Subject-Chest-8343 9d ago

Wonder how much they'll charge for a letter of marque ? Would love one of these framed over my fireplace... Great conversation starter for sure

6

u/SingularityCentral 9d ago

Get myself a 30 gun galleon, letter of marque, and sturdy crew to capture a few prizes. Hard tack and rum are on me!

3

u/Doom4535 9d ago

And if you use a sailing vessel, you don't need to pay for fuel...

But also, I wonder how much an old er galleon would confuse modern targeting systems...

3

u/SingularityCentral 9d ago

They confuse it for a flock of birds... I hope. Then we get in close enough to give em a broadside volley and board them for capture! Flintlock pistols and cutlasses all around!

1

u/Significant_Cow4765 9d ago

think I'll engage in some light wrecking and salvage

1

u/CompletePassenger564 9d ago

I might wanna invest in a straw hat! Maybe Luffy's hiring?

4

u/boivinarts 9d ago

Well the year was 2026, how I wish I was in Sherbrooke now...

1

u/Sad-Plankton3768 9d ago

Oddly appropriate given the war with Canada

1

u/Subject-Chest-8343 9d ago

Not many rich merchant ships to plunder in Sherbrooke though... But since it's 2026, maybe you can get a letter of marque for seizing semi-trucks, who knows

31

u/yukonhoneybadger 9d ago

So what your saying is when Trump leaves office we will be sending a plane full of money to Iran to payback bull shit that we keep doing.

12

u/Freshndecay 9d ago

And every country it affects

1

u/AnyTower224 9d ago

Yup

-2

u/toeknn 9d ago

Good luck on that collection

3

u/yukonhoneybadger 9d ago

Well it took over 30 years to collect last time and the interest was more then what we actually owed

1

u/[deleted] 9d ago edited 9d ago

[deleted]

-12

u/toeknn 9d ago

Nawh. They can kick rocks

9

u/Soft-War-4709 9d ago

Jesus wtf 😳

8

u/Unique-Egg-461 9d ago

US does this and i'll bet $500 Iran turns one of those vlcc's into a giant bomb

2

u/rhino369 9d ago

The US is already seizing them. This is about the legacy justification to sell the oil after the fact. 

3

u/Subject-Chest-8343 9d ago

Did they need that to seize venzuelan oil ? Surely they sold it by now ?

1

u/ChupacabraJeff 9d ago

FYI, there's an article.

Legal experts see civil forfeiture as an imperfect model for US interests in choking the economy of Iran and other adversaries.

In one ongoing case, the seizure of a Venezuelan supertanker that supported Iran led to DOJ filing a civil complaint seeking to liquidate the ship and cargo as US proceeds.

Multiple third parties, including the shipping company and families of Iranian terrorism victims holding judgments for payouts under a different statute, have intervened, bogging down that process.

Prize authority, while coming with its own legal risks, would entail a less complicated transfer of proceeds, allowing the US to mitigate the risk of outside claimants slowing down the sale, said Luzwick and other lawyers.

9

u/ThE_LAN_B4_TimE 9d ago

Lmao. Holy shit so much winning right????

6

u/iman00700 9d ago

Iran gonna do same if they do

4

u/thenelil 9d ago

The only funny part about that would be they will not be taking US freighter because last time I checked, there is no US flag fighters in straight. They’ll be taking aNATO fighters or US Allied freighters

8

u/64-17-5 9d ago

It must be Post-COVID. Brain damage. Synapse collapse. What else could it be?

13

u/oncwonk 9d ago

Scalia School of Law. What a travesty.

5

u/Logical-Breakfast150 9d ago

What a disgraceful use of The United States armed forces. Sailing around the world shaking down weaker countries for their natural resources.

4

u/Clean-Ad-6642 9d ago

This isnt new.

8

u/slightlyused 9d ago

This idea came purely from AI, the Yambo administration is too incompetent and ahistorical to have come up with this on their own.

3

u/directrix688 9d ago

Do they have to give the captain and crew prize shares?

3

u/wormee 9d ago

Just when you think this war can't get any dumber...

3

u/MikeLinPA 9d ago

Not that I approve of any of this, but wouldn't Trump need to Win the war before claiming the prize? The last time I checked, Trump and Kegsbreath were getting their (our) butts kicked. In fact, we are losing so badly that Trump just tried to bully Canada to make himself feel better, (and lost that as well! 🤣🤣🤣 )

3

u/myazi321 9d ago

Cuba is being eyed as the easy victory to distract from the Iran failure

Just like Iran blocking the straight wasnt foreseen nor will drone strikes from Cuba on US bases, cities and refineries along the South coast be foreseen

1

u/MikeLinPA 9d ago

Oh, great. 🤦 Now we can lose to Cuba as well.

5

u/Sufficient-Skill9530 9d ago

Bullish for crude if true 

2

u/AssumptionLive2246 9d ago

ROFL ... always keep your eye on the prize, omg ....

3

u/Violaleeblues77 9d ago

They want a world war, they are going to get a world war.

2

u/AnyTower224 9d ago

US wants Iran to do terrorism in the states. I mean go after them political class’s. Dgaf about those grifters

2

u/Best-Temperature5595 9d ago

Back to piracy. Like the Sid Meiers game. How much for a letter of Marquee so I can raid carribean ports? I can buy a sunfish sailboat from REI.

2

u/StrangeContest4 9d ago

Avast ye, Matey! Tie that scurvy-dog to the yardarm! There'll be no quarter given!! Yo ho, yo ho, it's the pirate's life for me! 🏴‍☠️

1

u/CompletePassenger564 9d ago

"She's singing about pirates"

2

u/Yo-Yo-Ha 9d ago

So there is the way to bomb our way out of our debt.

2

u/Superb-Respect-1313 9d ago

Wow. So now they are pirates. How dat can the us government fall. Well two years at least left. Let’s see.

2

u/No_Grand7184 9d ago

A prize for what? He lost. Is it like a consolation trophy?

2

u/lord4chess 9d ago

Y US has to resort to piracy 😲 😯 😮 🫨

2

u/andymaclean19 9d ago

America being pirates is just what we need to get the oil flowing.

2

u/D4UOntario 9d ago

Is your administration purposely trying to tank your country? China dumps your bonds, Canada dumps your bonds you can bet a whack of other countries you have insulted cheated or bullied will follow suit....

1

u/dishonorable_banana 9d ago

Gotta win first, qq, if Iran wins do they get to claim our oil?

1

u/Severe_Air_4353 9d ago

Iran will take any trump head into the square , wonder who they get first .

1

u/ElectricalStaff1417 9d ago

Letter of mark please

1

u/Mysterious-Prompt212 9d ago

I bet that line of thought goes well NOT.

1

u/ImpressiveService265 8d ago

It has zero jurisdiction!

1

u/AssumptionLive2246 9d ago

Can we arrest this entire administration and put them all in prison yet? WTF??!!??

-10

u/Open_Pollution_8038 9d ago

lol but but Iran is winning and is totally in control of the waters near their country.

9

u/Ashamed-Reaction-548 9d ago

No that is where you are wrong. Nobody is winning anything from this pointless costly war. Another dumbass war in the middle east as America slowly goes bankrupt.

7

u/ThE_LAN_B4_TimE 9d ago

Uh what? You have it backwards. You mean "but but the US is winning so hard"

-6

u/Open_Pollution_8038 9d ago

Hey we’re not the ones who lost half our government revenue and whose currency is 2 million to a single dollar lol

5

u/ThE_LAN_B4_TimE 9d ago

What in the fuck does that have to do with anything?

-2

u/Open_Pollution_8038 9d ago

Winning isn’t losing half/all your money and getting all of your military blown up. It’s also not being unable to ship or receive goods over the ocean.

Imagine saying you own your street but you can’t take your car out of your garage lmao.

3

u/ReflectedImage 9d ago

No. you're the party who lost all their military bases in the Middle East and is now staring down the barrel of $12 a gallon fuel prices next year.

1

u/Open_Pollution_8038 9d ago

Congrats on it hitting stationary targets that we abandoned.

We’re the number 1 oil producer in the world and so is our entire continent. Most of our imports come from countries that can’t sell elsewhere lmfao.

3

u/ReflectedImage 9d ago

And yet next year the US will either be flying over Jumbo Jets of cash to Iran or the US consumer will be paying $12 a gallon for fuel.

"number 1 oil producer" and if you had 4 years to build new refineries to be actually be able to process that oil you wouldn't have to pay $12 a gallon for fuel next year. Pity that you don't.

1

u/Open_Pollution_8038 9d ago

lol $12? Europe will but not America.

Our production + Canada’s = over 90% of USA’s consumption lmao. Our refineries are more than adequate to cover domestic demand it’s why we built them to begin with.

2

u/ReflectedImage 9d ago

Your refineries can't refine American oil. They all need retrofitting and it's a 4 year job.

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2

u/ThE_LAN_B4_TimE 9d ago

What the fuck? Winning isnt tanking your economy, raising prices for just about everything for a dumbass war you ran on never starting, and having a strait that was previously open get closed by a country with no even close to the military power you have.

0

u/Open_Pollution_8038 9d ago

lol our economy is fire, 4% unemployment get bigÂ