US Intensifies Sanctions on Iran's Oil Trade and Associated Entities

US Sanctions Target Iranian Oil Trade

Washington, April 25: The United States has escalated its sanctions against Iran by targeting a refinery in China and numerous vessels involved in the Iranian oil trade, aiming to diminish Tehran's energy revenue.

The Treasury Department's Office of Foreign Assets Control has specifically focused on Hengli Petrochemical (Dalian) Refinery Co., Ltd., which is recognized as one of the largest purchasers of Iranian crude oil and petroleum products.

Treasury Secretary Scott Bessent stated, “Economic Fury is tightening the financial grip on the Iranian regime, limiting its aggressive actions in the Middle East and curbing its nuclear aspirations.”

This action also encompasses around 40 shipping companies and vessels associated with what US officials refer to as Iran’s “shadow fleet.” According to the Treasury, these ships are responsible for transporting oil and petrochemicals to international markets, thereby providing crucial financial support to the Iranian government.

Bessent emphasized that under President Trump’s directive, the Treasury will persist in restricting the network of vessels, intermediaries, and buyers that Iran depends on to export its oil globally. He warned that any individual or vessel facilitating these transactions through covert means risks facing US sanctions.

Treasury officials noted that China's independent refineries, often called “teapots,” are significant buyers of Iranian crude oil. Hengli, identified as the second-largest of these refineries in China, has reportedly acquired “billions of dollars’ worth” of Iranian petroleum.

The announcement indicated that Hengli has received shipments linked to sanctioned vessels and Iran’s Armed Forces General Staff via Sepehr Energy Jahan Nama Pars Company, generating “hundreds of millions of dollars in revenue for the Iranian military.”

In a related action, the US has sanctioned 19 vessels accused of transporting billions of dollars worth of Iranian crude oil, liquefied petroleum gas, and other petrochemical products. These vessels were flagged from various jurisdictions, including Panama, Hong Kong, and Barbados.

Some of the tankers were reported to have delivered millions of barrels of Iranian oil to China, while others transported cargoes to the United Arab Emirates and Bangladesh. The Treasury noted that these vessels engaged in ship-to-ship transfers to obscure the oil's origin.

This action falls under Executive Order 13902, which specifically targets Iran’s petroleum and petrochemical sectors, as part of a wider strategy to exert economic pressure on Tehran's oil exports and financial networks.

Since February 2025, the Treasury has imposed sanctions on over 1,000 individuals, entities, vessels, and aircraft linked to Iran as part of this ongoing campaign.

According to US law, all properties and interests of designated entities within US jurisdiction are blocked, and transactions involving these parties are generally prohibited for US persons. Foreign entities may also face penalties for facilitating such activities.

The Treasury has cautioned that violations could result in civil or criminal penalties, and financial institutions could also be exposed to sanctions for engaging in transactions with designated entities.