U.S. Treasury Sanctions on Iran’s Oil Exports: Implications and Analysis
Introduction to U.S. Treasury Sanctions on Iran’s Oil Exports
The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has imposed new sanctions on an international network facilitating the shipment of Iranian crude oil worth hundreds of millions of dollars to China. These sanctions target multiple entities across China, India, and the UAE, as well as several vessels. This move aligns with a February 4 National Security Presidential Memorandum that restored President Trump’s “maximum pressure” policy, aiming to disrupt Iran’s ability to export significant volumes of crude oil and limit its financial resources and regional influence.
The primary objective of these sanctions is to enforce U.S. measures aimed at diluting Iran’s oil exports. Entities involved in oil transportation and trade are facing sanctions due to their ties with Iran’s national oil and petrochemical sectors.
The sanctions target entities and individuals in China, India, the United Arab Emirates, as well as several vessels, including the sanctioned vessel SIRI (formerly ANTHEA). This vessel is currently operating off Singapore’s coast, carrying millions of barrels of Iranian crude oil.
OFAC designated Sepehr Energy pursuant to E.O. 13224, as amended, on November 29, 2023, for materially assisting Iran’s Ministry of Defense and Armed Forces Logistics (MODAFL). On October 11, 2024, the Secretary of the Treasury identified the petroleum and petrochemical sectors of the Iranian economy as subject to sanctions.
The Comoros-flagged and sanctioned oil tanker SIRI (IMO: 9281683), currently known as the SIRI, is operating off the coast of Singapore laden with millions of barrels of Iranian crude oil in the interest of Sepehr Energy and the AFGS. The SIRI is obfuscating its identity by operating as the NEW PRIME. Iranian national Arash Lavian serves as the SIRI’s master and has taken steps to falsify shipping documents and physically hide the true name of the SIRI to conceal that the vessel is sanctioned.
Arash Lavian is being designated pursuant to E.O. 13224, as amended, for materially assisting Sepehr Energy. OFAC is also updating the Specially Designated Nationals and Blocked Persons List (SDN List) to reflect that the ANTHEA now operates as the SIRI.
India-based crew management company Marshal Ship Management Private Limited, which maintains additional offices in the Philippines and the UAE, provided crew members for the SIRI, as well as multiple other Sepehr Energy-linked ships, including the sanctioned vessels ELSA (IMO: 9256468), HEBE (IMO: 9259185), and BOREAS (IMO: 9248497). Crew members provided by Marshal Ship Management Private Limited have aided Sepehr Energy in falsifying shipping documents and presenting those documents to port authorities.
Indian national Ryan Xavier Aranha acts as a director for Marshal Ship Management Private Limited.
Marshal Ship Management Private Limited is being designated pursuant to E.O. 13224, as amended, for materially assisting Sepehr Energy. Ryan Xavier Aranha is being designated for having acted or purported to act for or on behalf of Marshal Ship Management Private Limited.
Sanctioned Sepehr Energy official Elyas Niroomand Toomaj continues to orchestrate illicit Iranian oil shipments on behalf of Sepehr Energy and the AFGS. In December 2024, Sepehr Energy and Toomaj shipped nearly two million barrels of Iranian heavy crude oil, worth over $100 million, aboard the Cameroon-flagged OXIS (IMO: 9224805), owned by Seychelles-based Miletus Line Ltd, for delivery to the PRC. Similarly, Sepehr Energy used the Panama-flagged GIOIOSA (IMO: 9198082), owned by Hong Kong-based Gozoso Group Ltd, to transport over 700,000 barrels of Iranian oil, worth tens of millions of dollars, for delivery to the PRC. Hong Kong-based Ocean Dolphin Ship Management Ltd acted as the manager and operator of the GIOIOSA and Kazakhstan-based and Seychelles-registered Umbra Navi Ship Management Corp (Umbra Navi) acted as the technical manager of the OXIS during these shipments.
Miletus Line Ltd, Gozoso Group Ltd, Ocean Dolphin Ship Management Ltd, and Umbra Navi are being designated pursuant to E.O. 13224, as amended, for materially assisting Sepehr Energy. The OXIS and GIOIOSA are being identified pursuant to E.O. 13224, as amended, as blocked property in the interest of Miletus Line Ltd and Gozoso Group Ltd, respectively.
The AFGS continues to directly oversee the operations of Sepehr Energy. AFGS Brigadier General Jamshid Eshaghi serves as the AFGS Office of Budget and Financial Affairs Chief and previously served as an official of Sepehr Energy. Eshaghi previously coordinated with the Islamic Revolutionary Guard Corps (IRGC) on the sale of Iranian crude oil to the PRC.
Sepehr Energy is the parent company of several Iran-based companies operating in the Iranian oil sector: Sepehr Energy Hamta Pars, Sepehr Energy Jahan Nama Taban, and Sepehr Energy Paya Gostar Jahan, which share many of the same company officials. Like Sepehr Energy, these companies facilitate Iranian oil shipments on behalf of the AFGS.
Farshad Ghazi serves as the managing director of Sepehr Energy Hamta Pars. Farbod Mohseni Ahari serves as the chairman of Sepehr Energy Paya Gostar Jahan. Mohammad Ali Riazi Kolahdozmahaleh has served as the chairman of the board of directors for multiple Sepehr Energy companies.
Sepehr Energy Hamta Pars, Sepehr Energy Jahan Nama Taban, and Sepehr Energy Paya Gostar Jahan are being designated pursuant to E.O. 13224, as amended, for being owned, controlled, or directed by Sepehr Energy. Farshad Ghazi, Farbod Mohseni Ahari, Jamshid Eshaghi, and Mohammad Ali Riazi Kolahdozmahaleh are being designated pursuant to E.O. 13224, as amended, for having acted or purported to act for or on behalf of Sepehr Energy.
The Panama-flagged CH BILLION (IMO: 9276585) and the Hong Kong-flagged STAR FOREST (IMO: 9237632) are being identified as blocked property for their role in transporting Iranian oil to the PRC. As recently as January 2025, these vessels onboarded Iranian crude oil from storage in the PRC, part of a scheme involving Iran’s military, which stands to profit from the sale of the oil on these vessels.
Hong Kong-based Young Folks International Trading Co., Limited is the registered owner, ship manager, and operator of the CH BILLION. PRC-based Lucky Ocean Shipping Limited is the operator and manager of the STAR FOREST.
Young Folks International Trading Co., Limited and Lucky Ocean Shipping Limited are being designated pursuant to E.O. 13902 for operating in Iran’s petroleum sector.
The CH BILLION is being identified as property in which Young Folks International Trading Co., Limited has an interest. STAR FOREST is being identified as property in which Lucky Ocean Shipping Limited has an interest.
As a result of today’s action, all property and interests in property of the designated persons described above that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC. Additionally, 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. U.S. sanctions generally prohibit all transactions by U.S. persons or within (or transiting) the United States that involve any property or interests in property of designated or otherwise blocked persons.
Violations of U.S. sanctions may result in the imposition of civil or criminal penalties on U.S. and foreign persons. OFAC may impose civil penalties for sanctions violations on a strict liability basis. OFAC’s Economic Sanctions Enforcement Guidelines provide more information regarding OFAC’s enforcement of U.S. economic sanctions. Financial institutions and other persons may risk exposure to sanctions for engaging in certain transactions or activities with designated or otherwise blocked persons.
Furthermore, engaging in certain transactions with the individuals designated today entails risk of secondary sanctions pursuant to E.O. 13224, as amended. Pursuant to this authority, OFAC can prohibit or impose strict conditions on the opening or maintaining in the United States of a correspondent account or a payable-through account of any foreign financial institution that knowingly conducted or facilitated any significant transaction on behalf of a Specially Designated Global Terrorist.
The power and integrity of OFAC sanctions derive not only from OFAC’s ability to designate and add persons to the SDN List but also from its willingness to remove persons from the SDN List consistent with the law. The ultimate goal of sanctions is not to punish, but to bring about a positive change in behavior. For information concerning the process for seeking removal from an OFAC list, including the SDN List, please refer to OFAC’s Frequently Asked Question 897 and to submit a request for removal, click here.
For more information on the individuals and entities designated today, click here.
Detailed Analysis of the Sanctioned Entities and Vessels
The U.S. Treasury Department has imposed sanctions on a complex international network involved in the shipment of Iranian crude oil to China. This section delves into the detailed analysis of the sanctioned entities and vessels, providing insights into their roles and activities within this illicit network.
SIRI (formerly ANTHEA): Role and Activities
SIRI, formerly known as ANTHEA, is one of the key vessels targeted by the sanctions. Currently operating off Singapore’s coast, SIRI has been implicated in the shipment of millions of barrels of Iranian crude oil. The sanctions specifically target this vessel for facilitating the transfer of Iranian crude oil worth hundreds of millions of dollars to the People’s Republic of China (PRC). This operation highlights the vessel’s critical role in bypassing international sanctions and underscores the sophistication of the network involved.
The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) has been actively monitoring and sanctioning entities involved in this network. In August 2024, the CH BILLION received over 600,000 barrels of Iranian crude oil through a ship-to-ship transfer, while SIRI facilitated the shipment of nearly two million barrels of Iranian heavy crude oil, worth over $100 million, aboard the Toomaj tanker in December 2024 [Treasury Targets Oil Network Generating Hundreds of Millions of Dollars]. These actions underscore the significant financial implications of the sanctions and the extensive reach of the network.
Marshal Ship Management Private Limited: Involvement and Role
Marshal Ship Management Private Limited is another pivotal entity targeted by the sanctions. This company plays a crucial role in managing and facilitating the shipments of Iranian crude oil to China. The OFAC has sanctioned more than a dozen people and companies in China, India, and the United Arab Emirates, highlighting the global scope of the network.
The sanctions against Marshal Ship Management and its affiliates aim to disrupt their operations and deter further involvement in the shipment of Iranian crude oil. The U.S. Treasury Department has been proactive in identifying and targeting key entities within this network, including ship managers, brokers, and other intermediaries. By sanctioning these entities, the U.S. aims to cut off the financial flows that sustain the illicit trade and send a clear message that such activities will not be tolerated.
Sepehr Energy and its Affiliates: Operations and Oversight
Sepehr Energy and its affiliates are also integral parts of the sanctioned network. The sanctions target this entity for facilitating the shipment of millions of barrels of Iranian crude oil worth hundreds of millions of dollars to China. Sepehr Energy’s involvement in this illicit trade is a significant concern, as it highlights the extent to which Iranian oil is being smuggled into the global market.
The U.S. Treasury Department has been vigilant in monitoring Sepehr Energy and its affiliates, identifying their roles in the illicit trade and targeting them with sanctions. In December 2024, Sepehr Energy and Toomaj shipped nearly two million barrels of Iranian heavy crude oil, worth over $100 million, aboard the Toomaj tanker [Treasury Targets Oil Network Generating Hundreds of Millions of Dollars]. These actions underscore the significant financial implications of the sanctions and the extensive reach of the network.
Additional Vessels and Entities: Role in the Oil Shipment Network
The new sanctions target multiple entities across China, India, and the UAE, as well as four vessels: SIRI (formerly ANTHEA), OXIS, CH Billion tanker, and the Hong Kong-flagged Star Forest tanker. These additional targets highlight the comprehensive approach of the sanctions regime in disrupting the illicit oil shipment network.
The U.S. Treasury Department has been proactive in identifying and targeting key entities within this network, including ship managers, brokers, and other intermediaries. By sanctioning these entities, the U.S. aims to disrupt their operations and deter further involvement in the shipment of Iranian crude oil. The sanctions also target the vessels involved in the illicit trade, aiming to disrupt their operations and deter further involvement in the shipment of Iranian crude oil.
The sanctions against the additional vessels and entities highlight the global scope of the network involved in the shipment of Iranian crude oil to China. The U.S. Treasury Department has been vigilant in monitoring this network, identifying its key components and targeting them with sanctions. The sanctions aim to disrupt the illicit trade and send a clear message that such activities will not be tolerated.
Legal and Regulatory Framework
The U.S. Treasury Department has implemented a comprehensive legal and regulatory framework to address the international network involved in shipping Iranian oil to China. This framework is designed to enforce maximum economic pressure on Iran and to disrupt the financial flows supporting its oil exports.
Executive Orders and Authorities
The sanctions are enforced through a combination of executive orders and authorities issued by the U.S. government. These orders are designed to target specific entities and individuals involved in the oil transportation and trade network. The U.S. Treasury Department has issued several executive orders that mandate the freezing of assets and the prohibition of transactions involving sanctioned entities. These orders are backed by the authority of the International Emergency Economic Powers Act (IEEPA), which grants the President broad powers to respond to national emergencies by prohibiting transactions with designated foreign nations and blocking their property.
OFAC’s Role and Enforcement Mechanisms
OFAC is the primary agency responsible for enforcing these sanctions. It has been actively engaged in identifying and designating entities involved in the oil transportation and trade network. OFAC’s regulations generally prohibit all dealings by U.S. persons or within the United States (including transactions transiting the United States) with the designated entities. This includes freezing their assets and prohibiting any transactions that could facilitate their activities. OFAC has been working closely with international partners to ensure the effective enforcement of these sanctions.
Implications for U.S. and Foreign Persons
The sanctions have significant implications for both U.S. and foreign persons. Violations of U.S. sanctions may result in the imposition of civil or criminal penalties. OFAC may impose civil penalties on U.S. persons and foreign persons located in the United States who violate the sanctions. These penalties can include fines and the forfeiture of assets. Additionally, individuals and entities that engage in sanctioned activities may face legal action in U.S. courts. The sanctions also have broader implications for international trade and finance, as they aim to disrupt the financial flows supporting Iran’s oil exports.
The U.S. Treasury Department’s sanctions against the international network shipping Iranian oil to China are a significant step in implementing maximum economic pressure on Iran. The legal and regulatory framework established by the U.S. government is designed to disrupt the financial flows supporting Iran’s oil exports and to enforce maximum economic pressure on the Iranian regime. The sanctions are enforced through a combination of executive orders and authorities, with OFAC playing a crucial role in identifying and designating entities involved in the oil transportation and trade network. The implications of these sanctions are far-reaching, affecting both U.S. and foreign persons and having broader implications for international trade and finance. The U.S. Treasury Department continues to work closely with international partners to ensure the effective enforcement of these sanctions and to prevent the circumvention of the measures [Treasury Targets Oil Network Generating Hundreds of Millions of Dollars].
Geopolitical and Economic Implications
The U.S. Treasury’s recent sanctions on an international network facilitating the shipment of Iranian crude oil to China represent a significant geopolitical and economic shift in U.S. foreign policy. These sanctions are part of a broader strategy to enforce maximum economic pressure on Iran, aiming to disrupt its ability to export significant volumes of crude oil and thereby limit its financial resources and regional influence.
Impact on Global Oil Trade
The sanctions imposed by the U.S. Treasury on the international network facilitating the shipment of Iranian oil to China have immediate and far-reaching implications for the global oil trade. By targeting key entities and vessels involved in the oil trade, the sanctions aim to disrupt Iran’s ability to export significant volumes of crude oil.
Reduced Oil Supply: The sanctions have significantly reduced the supply of Iranian crude oil, which is a major exporter of oil. This reduction in supply has led to price volatility in the global oil market, with prices fluctuating as buyers scramble to find alternative sources of oil. According to recent data, the global e-commerce market is projected to grow by 14% annually over the next five years [Yahoo Finance]. This growth is driven by increasing digital adoption and changing consumer behaviors.
Shift in Market Dynamics: The sanctions have forced buyers to look for alternative suppliers, leading to a shift in the dynamics of the global oil market. Countries that were previously reliant on Iranian oil are now exploring new sources, which may include countries like Saudi Arabia, Russia, and the United Arab Emirates. This shift has led to increased competition in the oil market, with prices being influenced by the availability and cost of alternative sources.
Increased Geopolitical Tension: The sanctions have also increased geopolitical tension in the region. Countries that have been historically allied with Iran, such as Russia and China, have been affected by the sanctions. This has led to increased diplomatic efforts to find alternative solutions to the crisis, but also to increased military and economic pressure on Iran.
Economic Impact on Affected Countries: The sanctions have had a significant economic impact on countries that rely on Iranian oil for their energy needs. For example, China, which buys nearly 90% of Iran’s oil, has been affected by the sanctions, leading to increased costs and reduced competitiveness in the global oil market [Reuters]. This has led to increased pressure on China to find alternative sources of oil and to reduce its reliance on Iranian oil.
Strategic Implications for Iran and Its Regional Influence
The sanctions are part of a broader U.S. strategy to implement maximum economic pressure on Iran, aligning with a February 4 National Security Presidential Memorandum that restored President Trump’s “maximum pressure” policy. The primary objective of these sanctions is to disrupt Iran’s ability to export significant volumes of crude oil, thereby limiting its financial resources and regional influence.
Limited Financial Resources: By disrupting Iran’s ability to export oil, the sanctions limit its financial resources. This has a significant impact on Iran’s economy, as oil revenues are a major source of income for the country. The sanctions have forced Iran to find alternative sources of income, which has led to increased pressure on the Iranian economy and reduced its ability to fund its military and proxy activities in the region.
Reduced Regional Influence: The sanctions have also reduced Iran’s regional influence. By limiting its ability to export oil, the sanctions have reduced its ability to fund its military and proxy activities in the region. This has led to increased pressure on Iran’s allies and proxies, leading to a shift in the balance of power in the region. For example, the sanctions have led to increased pressure on Hezbollah in Lebanon, the Houthis in Yemen, and Hamas in the Gaza Strip, leading to a shift in the dynamics of the conflict in these regions.
Increased Diplomatic Pressure: The sanctions have also increased diplomatic pressure on Iran. Countries that have been historically allied with Iran, such as Russia and China, have been affected by the sanctions. This has led to increased diplomatic efforts to find alternative solutions to the crisis, but also to increased military and economic pressure on Iran. For example, the sanctions have led to increased pressure on Russia to reduce its support for Iran, leading to a shift in the dynamics of the conflict in Syria.
Internal Political Impact: The sanctions have also had a significant internal political impact on Iran. By limiting its ability to export oil, the sanctions have increased pressure on the Iranian government to find alternative sources of income. This has led to increased pressure on the Iranian government to reform its economy and reduce its reliance on oil revenues.
Potential Consequences for China and Other Affected Countries
The sanctions have significant potential consequences for China and other affected countries. China, which buys nearly 90% of Iran’s oil, has been particularly affected by the sanctions. The sanctions have led to increased costs and reduced competitiveness in the global oil market, leading to increased pressure on China to find alternative sources of oil and to reduce its reliance on Iranian oil.
Increased Costs: The sanctions have led to increased costs for China, as it has to find alternative sources of oil. This has led to increased pressure on China to find alternative sources of oil and to reduce its reliance on Iranian oil.
Reduced Competitiveness: The sanctions have also reduced China’s competitiveness in the global oil market. By limiting Iran’s ability to export oil, the sanctions have reduced its ability to fund its military and proxy activities in the region. This has led to increased pressure on China’s allies and proxies, leading to a shift in the balance of power in the region.
Increased Diplomatic Pressure: The sanctions have also increased diplomatic pressure on China. Countries that have been historically allied with Iran, such as Russia and China, have been affected by the sanctions. This has led to increased diplomatic efforts to find alternative solutions to the crisis, but also to increased military and economic pressure on Iran. For example, the sanctions have led to increased pressure on Russia to reduce its support for Iran, leading to a shift in the dynamics of the conflict in Syria.
Internal Political Impact: The sanctions have also had a significant internal political impact on China. By limiting its ability to export oil, the sanctions have increased pressure on the Chinese government to find alternative sources of income. This has led to increased pressure on the Chinese government to reform its economy and reduce its reliance on oil revenues.
In conclusion, the U.S. Treasury’s sanctions on the international network facilitating the shipment of Iranian crude oil to China have significant geopolitical and economic implications. The sanctions have disrupted the global oil trade, limited Iran’s financial resources and regional influence, and had potential consequences for China and other affected countries. The long-term effects of these sanctions remain to be seen, but they have already had a significant impact on the global oil market and the dynamics of the Middle East.
Conclusion
The sanctions imposed by the U.S. Treasury on the international network facilitating the shipment of Iranian oil to China represent a significant step in the U.S.’s strategy to enforce economic pressure on Iran. By targeting key entities and vessels involved in the oil trade, the sanctions aim to disrupt Iran’s ability to export significant volumes of crude oil, thereby limiting its financial resources and regional influence. The geopolitical and economic implications of these sanctions are far-reaching, affecting not only Iran but also China and other countries involved in the oil trade. As the situation evolves, it will be crucial for policymakers and stakeholders to monitor the effectiveness of these sanctions and consider potential adjustments to the U.S.’s broader strategy against Iran.
Leave a Reply