The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has placed sanctions on Hengli Petrochemical, a major oil refinery located in Dalian, China. This action, announced on April 24, highlights the refinery’s significant role in facilitating Iran’s oil economy.
According to the Treasury, Chinese refineries, particularly those known as “teapot” refineries, are crucial buyers of Iranian crude oil, with Hengli Petrochemical being one of the largest purchasers. The company has reportedly acquired billions of dollars’ worth of Iranian oil, which is essential for generating revenue for Tehran.
Since at least 2023, Hengli has been receiving shipments of Iranian crude from a network of sanctioned vessels, often referred to as a shadow fleet. The Treasury noted that at least three of these vessels—BIG MAG, GALE, and ARES—have transported over five million barrels of Iranian oil.
In conjunction with the sanctions against Hengli, OFAC also imposed restrictions on approximately 40 shipping companies and vessels linked to Iran’s shadow fleet. This move is part of broader efforts to limit Iran’s oil exports amid ongoing geopolitical tensions.
On April 13, U.S. President Donald Trump ordered the implementation of a maritime blockade against Iran following unsuccessful peace talks in Islamabad on April 11-12. The Strait of Hormuz, a vital waterway for global oil and liquefied natural gas transport, has faced increased tensions due to airstrikes by the U.S. and Israel against Iranian targets, which began on February 28, as well as Iranian retaliatory strikes in the region.
The U.S. has sanctioned Hengli Petrochemical for its involvement in the Iranian oil trade, reflecting ongoing tensions in the region. This move aims to restrict Iran's oil revenue amid heightened geopolitical conflicts.
Source: U.S. Department of the Treasury