US Imposes Sanctions on Iranian Oil Smuggling Network

The US Department of the Treasury has enacted sanctions against a network involved in smuggling Iranian liquid petroleum gas disguised as Omani LPG. This network utilized front companies and foreign bank accounts to evade US sanctions. The Treasury aims to disrupt the economic lifeline provided to Iran through these illicit operations. Secretary Scott Bessent emphasized the ongoing efforts to dismantle Iran's shadow fleet and banking networks. The sanctions also target Iranian exchange houses facilitating foreign currency transactions for sanctioned banks. This action is part of a broader strategy to maintain pressure on Iran and limit its revenue sources.

By Narendra Chaudhary Jun 6, 2026, 14:12 IST

Sanctions Target Iranian Oil Smuggling Operations

On Friday, the Office of Foreign Assets Control (OFAC) of the US Department of the Treasury announced sanctions against a network of individuals, companies, and vessels involved in the illicit shipment of Iranian liquid petroleum gas (LPG) disguised as Omani LPG. This network reportedly utilized front companies located in the United Arab Emirates and China, along with foreign bank accounts and Iran's so-called 'shadow fleet' to transport millions of barrels of LPG while obscuring its Iranian origin and evading US sanctions.

The Treasury Department emphasized that these sanctions aim to expose and disrupt the entities that provide essential economic support to Iran by exploiting international commercial systems to conceal their operations and evade restrictions. Secretary of the Treasury Scott Bessent remarked, 'Iran's economy is struggling, and its military is weakened.' He further stated, 'Through Economic Fury, Treasury will persist in dismantling Iran's shadow fleet, shadow banking networks, and access to global trade.'

In a statement on social media, US State Department spokesperson Tommy Pigott noted, 'The US is imposing sanctions on networks that have smuggled hundreds of millions of dollars in Iranian fuel. The administration will uphold maximum pressure on the Iranian regime through Economic Fury.'

OFAC is also targeting the Iranian exchange house Mehrdad Geramian Nik and Partners Company, along with its leadership, for facilitating the movement of hundreds of millions of dollars in foreign currency for sanctioned Iranian banks. Iran's foreign exchange system heavily relies on selected brokers and rahbar companies that use overseas shell and front companies to hide Iranian connections, bypass sanctions, and transfer funds through accounts typically held outside Iran for Iranian bank customers.

These Iranian exchange houses conduct billions of dollars in foreign currency transactions annually, enabling the regime and its military to evade sanctions, exploit the international financial system, and transfer funds from oil and petrochemical sales, according to the statement.

Recently, OFAC has taken several actions to dismantle Iran's broker networks, including sanctions against Radin Exchange, Arz Iran Exchange, Opal Exchange, and Amin Exchange. These measures further limit the Iranian regime's access to revenue used for developing weapons, supporting terrorist proxies, and enriching regime insiders at the expense of the Iranian populace.

The Treasury Department reiterated its commitment to maintaining maximum pressure on Iran and targeting the regime's capacity to generate, transfer, and repatriate funds. This latest action is in accordance with Executive Order 13902, which focuses on individuals operating within Iran's financial and petroleum sectors. These designations will enhance Treasury's Economic Fury and build upon a series of OFAC actions aimed at Iran's shadow banking and petroleum sales networks.

The Treasury is actively pursuing Economic Fury and has disrupted access to tens of billions of dollars in revenue that would otherwise be available to the Iranian regime and its affiliates. This includes actions that have resulted in the freezing of nearly half a billion dollars in cryptocurrency linked to the regime.

Additionally, the Treasury has intensified its efforts against Tehran's global shadow banking networks, designated entities supplying weapons and military components to Iran, sanctioned a corrupt Iraqi official involved in oil sales alongside Iran-backed militias in Iraq, and taken numerous actions against Iran's terrorist proxies. They have also targeted vessels, companies, and other entities that support Iran's illicit oil industry.

Through these measures, the administration is directly addressing the regime's primary revenue source. Any individual or vessel involved in the illicit trade of oil or other commodities through covert channels risks exposure to US sanctions. The Treasury will continue to aggressively target both traditional sanctions evasion tactics and the misuse of digital assets while freezing funds misappropriated from the Iranian people. Furthermore, the Treasury is prepared to act against any foreign company aiding illicit Iranian trade, including airlines, and may impose secondary sanctions on foreign financial institutions that facilitate Iran's activities.