US sanctions Chinese oil terminal, refinery in Iran crackdown

The US Treasury Department sanctioned a Chinese crude oil terminal and independent refinery that have handled millions of barrels of Iranian petroleum, as the Trump administration escalates pressure on Iran's energy export network.

The Rizhao Shihua Crude Oil Terminal at Lanshan port and Shandong Jincheng Petrochemical Group, an independent refinery in Shandong province, were among over 50 individuals, entities and vessels targeted in the sanctions package announced Oct. 9.

"The Treasury Department is degrading Iran's cash flow by dismantling key elements of Iran's energy export machine," Treasury Secretary Scott Bessent said in a statement.

The sanctions target actors that "have collectively enabled the export of billions of dollars' worth of petroleum and petroleum products, providing critical revenue to the Iranian regime," according to the statement.

Market implications

The designations mark the fourth round of Trump administration sanctions targeting China-based refineries purchasing Iranian crude.

Treasury said Shandong Jincheng has received more than a dozen shipments of Iranian crude worth hundreds of millions of dollars, delivered by shadow fleet vessels, including the previously sanctioned Luna Prime and Carina tankers.

The Rizhao terminal accepted more than a dozen shadow fleet vessels that collectively transported several million barrels of Iranian oil, including the newly sanctioned vessel Voy, the statement said.

Prior rounds of US sanctions on Chinese oil terminals have impacted operations there.

In August, the US imposed sanctions on Shanghai's Yangshan Shengang International Petroleum Storage and Transportation. The sanctions disrupted services at the terminal and led orders to be redirected to the Ningbo and Zhoushan areas.

Much of Iran's crude exports go to China, either directly or through transshipment via Singapore and Malaysia. Iran exported an average of 1.5 million b/d of crude oil in September, with an average of 934,000 b/d going to Singapore, 100,000 b/d going to China and 367,000 b/d going to Malaysia, according to S&P Global Commodities at Sea data.

Evasion networks

Treasury also targeted an extensive LPG trading network centered on UAE-based companies that facilitated Iranian petrochemical sales to Sri Lanka and other markets. The network used Hong Kong shell companies to process over $125 million in payments for Iranian LPG sales in early 2025, Treasury said.

The sanctions package also targets nearly two dozen tankers in the shadow fleet, which uses sophisticated obfuscation tactics, including ship-to-ship transfers in the Persian Gulf and waters off Singapore and Malaysia to disguise cargo origins, the statement said.

One newly sanctioned tanker, Madestar, transported approximately $2 billion worth of Iranian oil that Iran had stored at Chinese ports, Treasury said.

The vessel sanctions also target ships that transported Iranian propane and butane to markets in China, Bangladesh, and Sri Lanka and Yemen, the statement said.