US imposes sanctions on teapot oil refinery and CEO for Iranian oil purchases

Investing.com -- The Department of the Treasury’s Office of Foreign Assets Control (OFAC) today announced sanctions against a teapot oil refinery and its CEO for purchasing and refining Iranian crude oil worth hundreds of millions of dollars. The oil was sourced from vessels linked to Ansarallah, a Foreign Terrorist Organization, and the Iranian Ministry of Defense of Armed Forces Logistics (MODAFL).

The refinery, known as Shandong Shouguang Luqing Petrochemical Co., Ltd (Luqing Petrochemical), located in Shandong Province, has procured millions of barrels of Iranian oil. The CEO, Wang Xueqing, is also facing sanctions for his role in the refinery’s operations. The sanctions are a part of the United States’ commitment to disrupt the revenue streams that fund Tehran’s terrorist activities and nuclear program development.

In addition to the refinery and its CEO, OFAC is imposing sanctions on 19 entities and vessels for shipping millions of barrels of Iranian oil. These oil shipments are part of Iran’s "shadow fleet" of tankers supplying teapot refineries like Luqing Petrochemical.

These actions are in accordance with Executive Order (E.O.) 13902, which targets Iran’s petroleum and petrochemical sectors. This marks the fourth round of sanctions targeting Iranian oil sales since the President issued National Security Presidential Memorandum 2 on February 4, 2025, ordering a campaign of maximum pressure on Iran.

The Department of State is also designating one entity under E.O. 13846, for knowingly engaging in a significant transaction for the purchase, acquisition, sale, transport, or marketing of petroleum or petroleum products from Iran.

The Iranian crude oil is transported to teapot refineries via a "shadow fleet" of vessels that often engage in deceptive shipping practices. Today, OFAC is sanctioning eight vessels that are part of this fleet. Several Hong Kong, Liberia, and PRC-based companies serve as the registered owners and operators of these vessels.

As a result of today’s actions, all property and interests in property of the designated persons that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC. Also, any entities that are owned, directly or indirectly, individually or in the aggregate, 50 percent or more by one or more blocked persons are also blocked.

Violations of U.S. sanctions may result in the imposition of civil or criminal penalties on U.S. and foreign persons. Financial institutions and other persons may risk exposure to sanctions for engaging in certain transactions or activities with designated or otherwise blocked persons.

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