US targets Chinese and Indian operators in new sanctions on Iran’s shadow oil fleet

WASHINGTON – The US imposed a fresh round of sanctions targeting Iran’s oil industry on Feb 24, hitting more than 30 brokers, tanker operators and shipping companies for their role in selling and transporting Iranian petroleum, the Treasury Department said.

The announcement comes as US President Donald Trump seeks to bring Iran’s crude exports to zero to prevent the country from obtaining a nuclear weapon and builds on the layers of sanctions already imposed by his government and the previous Biden administration.

“Iran continues to rely on a shadowy network of vessels, shippers and brokers to facilitate its oil sales and fund its destabilising activities,” Treasury Secretary Scott Bessent said in a statement.

“The United States will use all our available tools to target all aspects of Iran’s oil supply chain, and anyone who deals in Iranian oil exposes themselves to significant sanctions risk,” he added.

The new sanctions target oil brokers in the United Arab Emirates (UAE) and Hong Kong, tanker operators and managers in India and China, the head of Iran’s National Iranian Oil Company and the Iranian Oil Terminals Company, the Treasury said.

The Iranian Oil Terminals Company oversees all operations at Iran’s oil terminals, including Kharg Island Oil Terminal, through which a majority of Iranian oil flows, and South Pars Condensate Terminal, which accounts for 100 per cent of Iran’s gas condensate exports, according to the Treasury.

Mr Trump earlier in February restored his “maximum pressure” campaign on Iran that includes efforts to drive the country’s oil exports to zero, reimposing Washington’s tough policy on Iran that was practised throughout his first term.

Oil is a top source of revenue for Iran, and targeting the country’s exports is meant to deny the government funds for its nuclear and missile programmes.

The move generally prohibits any US individuals or entities from doing any business with the targets and freezes any US-held assets.

Mr Trump had accused his predecessor, former president Joe Biden, of failing to rigorously enforce oil export sanctions.

Despite US sanctions, Tehran’s oil exports brought in US$53 billion (S$71 billion) in 2023 and US$54 billion a year earlier, according to US Energy Information Administration estimates.

Output during 2024 was running at its highest level since 2018, based on Organisation of the Petroleum Exporting Countries (Opec) data.

Mr Trump had driven Iran’s oil exports to near-zero during part of his first term after reimposing sanctions, but they rebounded under Mr Biden’s White House tenure as Iran succeeded in evading sanctions.

It is unclear if Mr Trump’s measures will push Iran’s exports back down significantly.

China does not recognise US sanctions, and Chinese firms buy the most Iranian oil. China and Iran have built a trading system that uses mostly Chinese renminbi and a network of middlemen, avoiding the dollar and exposure to US regulators.

The Paris-based International Energy Agency believes Saudi Arabia, the UAE and other Opec members have spare capacity to make up for any lost exports from Iran, also an Opec member. REUTERS