May 8, 2025 | Washington, D.C.
In a significant escalation of the United States’ maximum pressure campaign on Iran, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) today announced a new wave of sanctions aimed at disrupting Iran’s shadowy oil export network. The move targets a Chinese independent refinery, three port terminal operators in China’s Shandong Province, several maritime companies and vessels involved in clandestine oil transfers, and two ship captains accused of enabling Iran’s sanctions-evasion tactics.
Targeting Chinese “Teapot” Refineries and Oil Port Terminals
Among the most prominent designations is Hebei Xinhai Chemical Group Co., Ltd., a so-called “teapot” refinery in Hebei Province. The firm, which has imported Iranian crude oil worth hundreds of millions of dollars using ships tied to Iran’s shadow fleet, was designated for materially assisting the National Iranian Oil Company (NIOC). OFAC also designated its Singapore-based subsidiary, Xing AO Energy PTE. LTD., under similar sanctions.
This marks OFAC’s third action against a Chinese teapot refinery and its first targeting oil port terminals. Three companies involved in operating a terminal at Dongying Port—Baogang (Dongying Donggang) Logistics and Warehousing Co., Ltd., Shandong Jingang Port Co., Ltd., and Shandong Baogang International Port Co., Ltd.—were sanctioned for facilitating the import of Iranian oil from vessels previously designated under sanctions.
“These actions reinforce our resolve to dismantle Iran’s petroleum supply chain,” said Treasury Secretary Scott Bessent. “As part of President Trump’s aggressive maximum pressure campaign, we will continue to target every link in the network that enables the Iranian regime to fund terrorism and regional destabilization.”
Breaking the Shadow Fleet
The Treasury Department also cracked down on the maritime network supporting Iran’s covert oil exports—often referred to as the “shadow fleet.” This loosely organized armada of tankers disguises Iranian oil shipments through ship-to-ship (STS) transfers, reflagging, and falsified documentation.
Six tankers were named for transporting billions of dollars in Iranian crude to China and the Persian Gulf:
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STAR TWINKLE 6
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LAMD (formerly TAI HE)
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SKADI
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BIG MAG
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IMPALAS
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THANE
OFAC designated the companies that own these tankers—Star Twinkle Shipping Limited, Hong Kong Prime Trading Co., Ltd., Skadi Limited, Propitious Forever Trading Co. Ltd, Embrace Que Limited, and Nissho Lines Incorporated—under Executive Order 13902 for operating in Iran’s petroleum sector.
These vessels frequently conducted ship-to-ship transfers with already-sanctioned vessels such as SERENE I, CATALINA 7, NATALINA 7, and ELIZA II, enabling Iran to mask the origin of its crude exports.
Designating Ship Captains
In an unprecedented move, OFAC also designated two Indian nationals—Ketan Agarwal and Lincoln Francisco Viegas—for captaining vessels linked to Iran’s oil exports. Agarwal has reportedly served aboard multiple sanctioned ships since 2017, including the JAYA and BENDIGO, while Viegas commanded the LIONESS, all of which were involved in unauthorized Iranian oil transport.
Sanctions Implications
All property and interests in property of the designated persons and entities within U.S. jurisdiction are now blocked. This includes entities owned 50% or more by sanctioned parties. U.S. persons are generally prohibited from engaging in transactions involving these entities unless specifically authorized by OFAC.
The Treasury warned that violations could lead to serious civil or criminal penalties, stressing that OFAC may impose such penalties on a strict liability basis, meaning intent is not required to trigger enforcement.
Background
These sanctions fall under Executive Orders 13846 and 13902, which authorize penalties against those supporting Iran’s petroleum and petrochemical sectors. The broader effort was initiated under National Security Presidential Memorandum 2 (NSPM-2), part of the Trump administration’s maximum pressure strategy aimed at curtailing Iran’s ability to fund its military operations and proxy activities across the Middle East.
