OFAC revokes General License X, issues narrower GL X-1 for Iran energy-sector winding down

On 5 July 2026, the US Office of Foreign Assets Control (OFAC) revoked General License X (GL X), issued on 18 June 2026, and replaced it with General License X-1 (GL X-1). GL X-1 is narrower in scope and contains additional conditions. Key changes include: GL X-1 authorises winding down of transactions and payment into blocked accounts only for persons in Iran's energy sector ordinarily resident in Iran on 18 June 2026—a narrower formulation than GL X. Covered persons are now limited to those listed in Annex A, providing greater clarity but restricting the license to a fixed list. Funds must be paid into blocked accounts in US jurisdiction and cannot be transferred away from Iran. GL X-1 authorises only transactions related to winding down pre-existing business relationships; new transactions or ongoing operations are not permitted. Any winding down must be completed by 18 September 2026. The license includes conditions and certifications regarding transaction purpose and US sanctions law compliance. The revocation represents a tightening of OFAC's Iran sanctions approach. Companies with Iran energy-sector exposure should review GL X-1 to determine whether their transactions qualify for authorisation. Those whose transactions do not qualify must ensure compliance with applicable sanctions law. Failure to comply could result in significant civil and criminal penalties.