US Sanctions Hengli Over Iran Oil, China Pushes Back
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- US Treasury added Hengli Petrochemical (Dalian) Refinery Co Ltd to the SDN List on April 24, identifying it as China’s second-largest independent 'teapot' refiner and a major buyer of Iranian crude
- Hengli Petrochemical (Dalian) has received over five million barrels of Iranian crude since at least 2023 via multiple sanctioned shadow-fleet vessels, according to OFAC
- US OFAC sanctioned approximately 40 shipping firms and vessels tied to Iran’s shadow fleet, with registrations in Hong Kong, mainland China, UAE, Vietnam, and Malaysia
- China defended Hengli against the sanctions, with Foreign Ministry spokesperson Lin Jian stating the measures constitute long-arm jurisdiction and violate international law
Why it matters: Hengli’s designation risks disrupting China’s independent refining sector and escalates US-China friction over Iran sanctions enforcement. The inclusion of Chinese-registered vessels amplifies diplomatic and commercial stakes, as Beijing rejects Washington’s extraterritorial reach with few tools to shield its firms.
