The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced sweeping sanctions on April 24, 2026, targeting a major Chinese oil refinery and a global network of shipping companies and vessels. The action is part of the administration’s Economic Fury campaign, designed to dismantle the financial infrastructure supporting Iran’s oil exports and its regional activities.
The primary target of the sanctions is Hengli Petrochemical (Dalian) Refinery Co., Ltd., an independent teapot refinery located in the port city of Dalian, China. According to Treasury officials, Hengli has a processing capacity of approximately 400,000 barrels of crude oil per day. The department alleged that the facility has been a primary customer for Iranian crude since 2023, purchasing billions of dollars’ worth of petroleum products that directly fund the Iranian military and government operations.
In addition to the refinery, OFAC designated roughly 40 shipping firms and tankers identified as part of Iran’s shadow fleet. These vessels utilize deceptive practices, such as ship-to-ship transfers and disabling tracking systems, to obscure the origin of Iranian oil. The Treasury stated that this maritime network serves as a critical financial lifeline for Tehran, enabling the regime to bypass existing international restrictions.
Treasury Secretary Scott Bessent stated that the measures are intended to impose a financial stranglehold on the Iranian regime. Bessent noted that the sanctions are being implemented at the direction of President Trump to constrict the network of intermediaries and buyers that Iran relies on for global market access. The Secretary further characterized the move as a necessary step to curtail Iran’s nuclear ambitions and its influence in the Middle East.
To manage the immediate impact on global supply chains, OFAC issued Iran-related General License V. This license provides a specific timeframe for the wind-down of existing transactions involving Hengli Petrochemical. However, the Treasury emphasized that the long-term goal remains the total cessation of trade between the refinery and Iranian entities.
The sanctions come amid heightened tensions in the Persian Gulf, following a U.S.-led physical blockade of the Strait of Hormuz earlier this month. They also precede a scheduled summit between President Trump and Chinese President Xi Jinping. China remains the largest buyer of Iranian oil, and the Treasury’s move represents a significant escalation in the use of secondary sanctions against Chinese industrial interests.
The entities added to the Specially Designated Nationals List include firms based in the United Arab Emirates, Hong Kong, and the Marshall Islands. Notable vessels named in the action include the chemical tanker Lisboa and the crude oil tankers Lynn and Magnolia, which are allegedly linked to the sanctioned shipping network.