The U.S. Treasury's Office of Foreign Assets Control (OFAC) announced on Friday a sweeping set of sanctions targeting a major Chinese oil refinery, Hengli Petrochemical, and a network of 19 ships tied to Iran's so-called 'shadow fleet,' in an effort to disrupt Tehran's primary source of revenue from oil exports [1]. According to Treasury officials, Hengli Petrochemical is one of Iran’s largest oil buyers and has received Iranian oil cargoes from sanctioned vessels since at least 2023, including shipments linked to Sepehr Energy Jahan Nama Pars Company, a front for Iran’s armed forces [1]. The U.S. alleges that these transactions have generated hundreds of millions of dollars for the Iranian military, supporting its programs and regional proxy groups [1].
The sanctions are part of a broader campaign, dubbed Economic Fury, which aims to impose a 'financial stranglehold' on the Iranian regime, curtailing its military aggression in the Middle East and its nuclear ambitions, according to Treasury Secretary Scott Bessent [1]. The targeted 'shadow fleet' consists of aging tankers and shell companies that facilitate the movement of Iranian petroleum products across global markets while evading sanctions by transferring cargo between ships in international waters [1].
U.S. officials emphasized that oil exports remain the backbone of Iran’s economy, and restricting these flows is intended to limit the government’s ability to fund its military, support proxy groups, and advance its nuclear program [1]. The Treasury Department warned that additional sanctions are likely as the U.S. continues to target the networks enabling Iranian oil sales [1].
The move marks an escalation in the Trump administration’s 'maximum pressure' campaign against Iran, signaling a commitment to stricter enforcement of sanctions and a willingness to target foreign entities, including major Chinese firms, involved in the Iranian oil trade [1].
CONCLUSION
The U.S. has intensified its efforts to restrict Iran's oil revenue by sanctioning a major Chinese refinery and a network of tankers linked to Iranian oil exports. This action is expected to have significant market implications, particularly for entities involved in the Iranian oil trade, and signals the likelihood of further sanctions as part of the ongoing campaign against Iran.