U.S. Imposes Sanctions on Chinese Refinery and Shippers Over Iranian Oil Trade

The Trump administration imposed economic sanctions on Hengli Petrochemical, a China-based oil refinery, and roughly 40 shipping companies and tankers involved in transporting Iranian oil. The sanctions, announced on Friday, target entities accused of facilitating Iran's oil exports, a key revenue source for the country.

Hengli Petrochemical's facility in Dalian processes about 400,000 barrels of crude oil per day, making it one of China's largest independent refineries. The Treasury Department stated that Hengli has received Iranian crude oil shipments since 2023, generating hundreds of millions of dollars in revenue for the Iranian military.

The measures also include sanctions on 19 tankers, as reported by one source, though others cited approximately 40 shipping companies and tankers. Additionally, the sanctions extend to multiple crypto wallets used by the Central Bank of Iran, according to a defense analysis account.

These actions follow the U.S. imposition of a physical blockade on the Strait of Hormuz earlier this month, a waterway critical to global energy supplies. The blockade has contributed to turmoil in the global energy trade, with war in the Persian Gulf disrupting oil and natural gas shipments and causing prices to rise.

“We will continue to constrict the network of vessels, intermediaries and buyers Iran relies on to move its oil to global markets." — Treasury Secretary Scott Bessent, Friday (ABC News). The sanctions come weeks before President Donald Trump is scheduled to meet China's Xi Jinping in China. China is the largest buyer of Iranian oil, importing 80% to 90% of it before the U.S.-Israeli war with Iran began, often with origins obscured and labeled as coming from countries like Malaysia. Smaller refineries, known as teapot refineries, are typical buyers of Iranian oil, transported by a shadow fleet of vessels. The advocacy group United Against Nuclear Iran reported in February 2025 that Hengli is among dozens of Chinese purchasers of Iranian oil.”