After Trump directive, new US sanctions target Iran's oil exports to China

The United States announced sanctions on networks involved in shipping Iranian oil to China on Thursday, two days after President Trump reinstated the so-called maximum pressure policy on Iran from his first term.

The coordinated actions by the Treasury Department and the State Department span multiple countries, including China, India and the United Arab Emirates and involve several vessels linked to Iran's exports.

Trump's directive on Tuesday aims to drive oil sales by its top Middle East adversary down to zero.

“The Iranian regime remains focused on leveraging its oil revenues to fund the development of its nuclear program, to produce its deadly ballistic missiles and unmanned aerial vehicles, and to support its regional terrorist proxy groups,” Treasury Secretary Scott Bessent said in a statement.

“The United States is committed to aggressively targeting any attempt by Iran to secure funding for these malign activities,” he added.

China is by far the biggest buyer of Iranian oil and Trump has repeatedly lambasted his predecessor Joe Biden for allowing sales to creep back up.

Iran's economy is teetering under the pressure of US-led sanctions, which Washington hopes will cut off funding to Tehran's armed allies in the Middle East.

The State Department also released a statement announcing sanctions on companies it says funnel oil revenue to Iran’s military.

“I applaud President Trump’s return to maximum pressure on the Iranian regime and willingness to confront both Iran and (China),” said Senator James Risch, the top Republican on the Senate Foreign Relations Committee.

“After years of Biden refusing to enforce oil sanctions on Iran, I enacted the SHIP Act to force sanctions on Chinese purchases of Iranian oil,” he added, referring to the 2024 Stop Harboring Iranian Petroleum (SHIP) law.

The treasury's move focuses on state firm Sepehr Energy, previously designated by the Office of Foreign Assets Control in late 2023 for its alleged ties to Iran’s Ministry of Defense and Armed Forces Logistics.

"Sepehr Energy and its affiliate companies ... use deceitful evasion methods such as falsification of maritime documents to obfuscate the Iranian origin of the oil that it trades and transports to overseas buyers, including (China)." the Treasury said in its press release.

The new sanctions aim to disrupt Iran’s use of foreign-based brokers and front companies to bypass restrictions and sustain its oil exports, the treasury said.