The Trump administration has imposed economic sanctions on a major China-based oil refinery and approximately 40 shipping companies and tankers involved in transporting Iranian oil. The move, announced on Friday and first reported by The Associated Press, fulfills the administration's threat to impose secondary sanctions on entities and nations conducting business with Iran. It is part of a broader Republican-led campaign to cut off Iran's primary revenue source—its oil exports.
Blockade and diplomatic tensions
Concurrently, the United States implemented a physical blockade on the Strait of Hormuz, a critical Persian Gulf waterway for global energy supplies. These sanctions come just weeks before a scheduled meeting between President Donald Trump and China's Xi Jinping. Included in the sanctions is Hengli Petrochemical's facility in Dalian, which processes roughly 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.
Advocacy and Treasury actions
The advocacy group United Against Nuclear Iran noted in February 2025 that Hengli is among dozens of Chinese purchasers of Iranian oil. Treasury Secretary Scott Bessent said Friday that his agency 'will continue to constrict the network of vessels, intermediaries and buyers Iran relies on to move its oil to global markets.' Earlier this month, the Treasury sent letters to financial institutions in China, Hong Kong, the UAE, and Oman, threatening secondary sanctions for doing business with Iran and accusing those countries of facilitating Iranian illicit activities.
During a White House briefing on April 15, Bessent stated the administration has warned countries: 'If you are buying Iranian oil, if Iranian money is sitting in your banks, we are now willing to apply secondary sanctions, which is a very stern measure.' The sanctions coincide with global energy trade turmoil as conflict around the Persian Gulf disrupts oil and natural gas shipments, driving prices higher. To mitigate the impact of rising oil prices, the Treasury has issued temporary sanctions waivers on Russian oil and a one-time waiver on Iranian oil already at sea.
