US sanctions Chinese-based refinery, 40-ship company over Iran oil
The Trump administration is placing economic sanctions on a major China-based oil refinery and roughly 40 shipping companies and tankers involved in transporting Iranian oil.
The move, announced and first reported by The Associated Press, makes good on the Trump administration’s threat to impose secondary sanctions on companies and countries that do business with Iran.
It’s also part of the Republican administration’s overall ramped-up campaign to cut off Iran’s key source of revenue — its oil exports. Concurrently, the US this month imposed a physical blockade on the Strait of Hormuz, the Persian Gulf waterway that is crucial to global energy supplies.
These sanctions come just a few weeks before President Donald Trump and China’s Xi Jinping are due to meet in China. Included in Friday’s sanctions is Hengli Petrochemical’s facility in the port city of Dalian, which has a processing capacity of roughly 400,000 barrels of crude oil per day, making it one of the biggest independent refineries in China.
The Treasury Department says Hengli has received Iranian crude oil shipments since 2023 and has generated hundreds of millions of dollars in revenue for the Iranian military. Treasury Secretary Scott Bessent said that his agency “will continue to constrict the network of vessels, intermediaries and buyers Iran relies on to move its oil to global markets.”
Bessent’s department sent a letter to financial institutions in China, Hong Kong, the UAE and Oman threatening to levy secondary sanctions for doing business with Iran and accusing those countries of allowing Iranian illicit activities to flow through their financial institutions.
Bessent said during a White House press briefing on April 15 that the administration has told countries, “That if you are buying Iranian oil, that if Iranian money is sitting in your banks, we are now willing to apply secondary sanctions, which is a very stern measure.”
The sanctions come as the global energy trade is in turmoil, as war around the Persian Gulf chokes off oil and natural gas shipments, causing prices to soar.
Treasury has tried to quell the impact of rising oil prices issuing temporary sanctions waivers on Russian oil and a one-time waiver on Iranian oil already at sea.
