Full Breakdown
U.S. Sanctions Target Chinese Refinery and Iran’s Shadow Fleet
4/25/2026, 11:08:05 AM
Sanctions on Hengli Petrochemical and Iran’s Shadow Fleet
On April 25 2026 the U.S. Treasury’s Office of Foreign Assets Control (OFAC) imposed secondary sanctions on Hengli Petrochemical (Dalian) Refinery Co., a Chinese “teapot” refinery, and on roughly 40 shipping firms and 19 tankers identified as part of Iran’s “shadow fleet.” The designations block the entities from the U.S. financial system and warn that any third-party facilitating the oil trade may face secondary sanctions.
Background: “Economic Fury” Campaign
The sanctions are part of the Trump administration’s “Economic Fury” or “maximum pressure” effort to choke off Iran’s oil revenue, which funds its military, proxy networks and nuclear program. They follow a recent physical blockade of the Strait of Hormuz and a series of executive orders targeting Iran’s petroleum sector.
Key Players and Scale
- Hengli Petrochemical (Dalian) Refinery Co. – China’s second-largest independent refinery, processing about 400,000 bbl per day, and a buyer of Iranian crude since 2023.
- Scott Bessent – Treasury Secretary who announced the measures.
- Sepehr Energy Jahan Nama Pars Co. – Identified by U.S. officials as a front for Iran’s Armed Forces General Staff.
- Liu Pengyu – Spokesperson for China’s embassy in Washington, who condemned the sanctions.
The Treasury identified roughly 40 shipping firms and 19 tankers, noted that China imports 80-90 % of Iran’s crude, and reported more than 1,000 Iran-related sanctions since February 2025.
Official Responses and Criticism
U.S. officials said the sanctions aim to constrict the network of vessels, intermediaries and buyers that move Iranian oil to global markets and warned that banks in China, Hong Kong, the UAE and Oman could face secondary sanctions. China’s embassy, through spokesperson Liu Pengyu, argued the measures “undermine international trade order” and “infringe upon the legitimate rights and interests of Chinese companies and individuals.”
Conflicting Figures
Sources differ on the vessel count: some list 19 specific tankers, while others cite roughly 40 shipping companies and tankers.
Verbatim Quotes
- “Economic Fury is imposing a financial stranglehold on the Iranian regime, hampering its aggression in the Middle East and helping to curtail its nuclear ambitions,” — Scott Bessent, Treasury Secretary
- “Treasury will continue to constrict the network of vessels, intermediaries, and buyers Iran relies on to move its oil to global markets,” — Scott Bessent, Treasury Secretary
- “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.” — Scott Bessent, White House press briefing, April 15 2026
- “These actions are designed to disrupt the networks that Iran relies on to move its oil into global markets,” — Senior Treasury official
Outlook
The sanctions arrive weeks before President Donald Trump’s summit with Xi Jinping in China and a U.S. envoy’s planned talks with Iranian officials in Pakistan, suggesting further designations of vessels, intermediaries and buyers are likely.
