US government revives Civil War-era court to claim Iranian oil

The US government is reaching deep into its legal toolkit, all the way back to the 1800s, to go after Iranian oil shipments. The Justice Department is preparing to activate a long-dormant maritime war court, known as a prize court, to fast-track the military capture of Iranian oil tankers as US prizes.

Prize law is the legal mechanism that allowed nations to seize enemy vessels and their cargo during wartime, then adjudicate ownership through specialized courts. The last time the US leaned on this framework in any significant way was during the Spanish-American War. Before that, it was a staple of Civil War-era naval strategy.

A surge in seizures

US authorities have been escalating civil forfeiture actions against Iranian oil cargoes throughout 2025 and into 2026, with multiple cases filed in federal courts citing connections to the Islamic Revolutionary Guard Corps.

In December 2025, the tanker M/T Skipper was seized while carrying approximately 1.89 million barrels of Venezuelan crude linked to Iran.

More recently, the vessels Tifani and Phonix were intercepted near Sri Lanka in 2026, adding to a growing list of confiscated tankers.

The legal authority for prize captures sits in Article I, Section 8 of the US Constitution, which grants Congress the power to “make Rules concerning Captures on Land and Water.” Previous Prize Acts governed how captured vessels were processed during wartime.

Why prize law, and why now

The existing approach to seizing Iranian oil relies on civil forfeiture statutes, which move slowly. Federal courts treat these cases like any other civil matter, complete with lengthy proceedings, jurisdictional complications, and procedural hurdles that can stretch timelines by months or years. A prize court would streamline that entire process, purpose-built for adjudicating maritime seizures.

Proceeds from previous forfeitures have been funneled into the US Victims of State Sponsored Terrorism Fund, creating a direct financial pipeline from seized Iranian assets to compensation for terrorism victims.

Recent boarding incidents near Sri Lanka suggest the operational tempo is increasing, and the legal infrastructure needs to keep pace with what the military is capturing.

Global oil and shipping implications

Legal experts are divided on the broader implications. Some see the prize law revival as a proportionate response to ongoing sanctions violations, arguing that existing forfeiture processes are simply too slow for the scale of enforcement now required. Others worry that if the US normalizes the use of wartime legal instruments during peacetime, other nations might adopt similar frameworks to justify their own maritime seizures.

China and India remain the largest buyers of Iranian crude, and neither country recognizes US secondary sanctions as binding on their trade.

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