Treasury Expands Targeted Sanctions on Iranian Petroleum and Petrochemical Sectors in Response to Attack on Israel
WASHINGTON — Today, the United States is expanding sanctions on Iran’s petroleum and petrochemical sectors in response to Iran’s October 1 attack on Israel, its second direct attack on Israel this year. This action intensifies financial pressure on Iran, limiting the regime’s ability to earn critical energy revenues to undermine stability in the region and attack U.S. partners and allies. The Secretary of the Treasury, in consultation with the Secretary of State, is identifying the petroleum and petrochemical sectors of the Iranian economy pursuant to section 1(a)(i) of Executive Order (E.O.) 13902, which allows Treasury to target a broader range of activities relating to Iran’s trade in petroleum and petrochemical products. E.O. 13902 provides authority to identify and impose sanctions on key sectors of Iran’s economy to deny the Iranian government financial resources that may be used to fund and support its nuclear program, missile development, terrorism and terrorist proxy networks, and malign regional influence. Pursuant to this determination, the Treasury may impose sanctions on any person determined to operate in the petroleum and petrochemical sectors of the Iranian economy.
OFAC is also designating 10 entities in multiple jurisdictions and identifying 17 vessels as blocked property, pursuant to E.O. 13846, for their involvement in shipments of Iranian petroleum and petrochemical products in support of the U.S.-designated National Iranian Oil Company (NIOC) and Triliance Petrochemical Co. Limited (Triliance). The U.S. Department of State is also designating six entities and identifying six vessels as blocked property pursuant to 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. Collectively, these actions target a significant portion of the shadow fleet of tankers and illicit operators that move the Iranian regime’s petroleum exports. NIOC was designated pursuant to the counterterrorism authority E.O. 13224, as amended, on October 26, 2020, for its financial support to Iran’s Islamic Revolutionary Guard Corps – Qods Force. Triliance was designated pursuant to E.O. 13846 on January 23, 2020 for facilitating the sale of Iranian petroleum products from NIOC.
“In response to Iran’s attack on Israel, the United States is taking decisive action to further disrupt the Iranian regime’s ability to fund and carry out its destabilizing activity,” said Secretary of the Treasury Janet L. Yellen. “Today’s sanctions target Iranian efforts to channel revenues from its energy industry to finance deadly and disruptive activity—including development of its nuclear program, the proliferation of ballistic missiles and unmanned aerial vehicles, and support to regional terrorist proxies—with dangerous consequences for the region and the world. We will not hesitate to take further action to hold Iran accountable.”
The United States is taking this action in the spirit of the Stop Harboring Iranian Petroleum Act (SHIP Act), enacted as a part of the Emergency Supplemental Appropriations for the 2024 Fiscal Year (P.L. 118-50), which imposes sanctions against foreign persons involved in the trade of petroleum and petroleum products originating in Iran and was recently delegated by the President to the Departments of the Treasury and State.
IRAN’S GHOST FLEET
Iran’s oil exports are enabled by a network of illicit shipping facilitators in multiple jurisdictions which, through obfuscation and deception, load and transport Iranian oil for sale to buyers in Asia. United Arab Emirates (UAE)-based Max Maritime Solutions FZE (Max Maritime) has used vessels under its management to conduct multiple ship-to-ship transfers of Iranian oil with vessels affiliated with the U.S.-designated National Iranian Tanker Company (NITC), which moves Iranian oil for NIOC, and to transport that oil to refineries in the People’s Republic of China (PRC). The Max Maritime-managed BENDIGO (IMO: 9289491) and CARNATIC (IMO: 9304655) conducted nearly a dozen ship-to-ship transfers of Iranian oil with NITC-affiliated vessels in 2023 alone. Much of this oil was later shipped to refineries in the PRC. Max Maritime also manages the SALVIA (IMO: 9297319), which has also transported Iranian oil to multiple refineries in the PRC.
Max Maritime is being designated pursuant to E.O. 13846 for, on or after November 5, 2018, having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services in support of, NIOC. The BENDIGO, CARNATIC, and SALVIA are being identified as property in which Max Maritime has an interest pursuant to E.O. 13846.
The LUNA PRIME (IMO: 9174220), formerly known as the Selene and owned and managed by Hong Kong-based Cathay Harvest Marine Ltd (Cathay Harvest), has also transported Iranian oil to multiple refineries in the PRC. The vessel also conducted a ship-to-ship transfer with a NITC vessel near Singapore to transport tens of thousands of metric tons of Iranian heavy crude oil.
Cathay Harvest is being designated pursuant to E.O. 13846 for, on or after November 5, 2018, having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services in support of, NIOC, a person whose property and interests in property are blocked pursuant to E.O. 13846. The LUNA PRIME is being identified as property in which Cathay Harvest has an interest pursuant to E.O. 13846.
Liberia-based Elza Shipping SA is the registered owner of the ELZA (IMO: 9221671)
The ELZA was involved in the transfer of hundreds of thousands of barrels of condensate from a NITC vessel and also conducted a ship-to-ship transfer with a NITC vessel near Singapore to transport tens of thousands of metric tons of South Pars condensate.
Elza Shipping SA is being designated pursuant to E.O. 13846 for, on or after November 5, 2018, having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services in support of, NIOC. The ELZA is being identified as property in which Elza Shipping SA has an interest pursuant to E.O. 13846.
UAE-based Jazira Das International Oil Products Trading LLC has served as the consignee on falsified cargo documents, masking millions of barrels of NIOC Iranian crude as Emirati oil. The company has also coordinated shipping activities for multiple NIOC oil shipments with U.S.-designated China Concord Petroleum Company, transporting millions of barrels of oil and obfuscating NIOC’s involvement in the shipments.
Jazira Das International Oil Products Trading LLC is being designated pursuant to E.O. 13846 for, on or after November 5, 2018, having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services in support of, NIOC.
The Harry Victor Ship Management and Operation L.L.C. has managed a vessel that has transported multiple shipments of Iranian petrochemicals for Iran’s Triliance Petrochemical Co. Limited. Harry Victor Ship Management and Operation L.L.C. manages the vessels the GOODWIN (IMO: 9379703), ANHONA (IMO: 9354521), and WEN YAO (IMO: 9288095).
Harry Victor Ship Management and Operation L.L.C. is being designated pursuant to E.O. 13846 for, on or after November 5, 2018, having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of, Triliance Petrochemical Co. Limited. The GOODWIN, ANHONA, and WEN YAO are being identified as property in which Harry Victor Ship Management and Operation L.L.C. has an interest pursuant to E.O. 13846.
Marshall Islands-based Rita Shipping Inc is the registered owner and manager of the SPIRIT OF CASPER (IMO: 9224271). The SPIRIT OF CASPER has carried multiple shipments of Iranian oil to refineries in the PRC.
Rita Shipping Inc is being designated pursuant to E.O. 13846 for, on or after November 5, 2018, having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services in support of NIOC. The SPIRIT OF CASPER is being identified as property in which Rita Shipping Inc has an interest pursuant to E.O. 13846.
PRC-based Derecttor Company Limited is beneficial owner, manager, and operator of the CRYSTAL ROSE (IMO: 9292228) and the manager and operator of the CARINA (IMO: 9240512). The CRYSTAL ROSE has transported hundreds of metric tons of Iranian oil on multiple shipments to China on behalf of NIOC and U.S.-designated China Concord Petroleum Co., Limited. The CARINA has transported shipments of Iranian oil to multiple PRC-based refineries.
Derecttor Company Limited is being designated pursuant to E.O. 13846 for, on or after November 5, 2018, having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services in support of, NIOC. The CRYSTAL ROSE and the CARINA are being identified as property in which Derecttor Company Limited has an interest pursuant to E.O. 13846.
Malaysia-based Delnaz Ship Management Sdn Bhd is the manager and operator of the DIMITRA II (IMO: 9208215), which has been used by China Concord Petroleum Co., Limited to ship millions of barrels of Iranian oil from the NIOC to the PRC. The TYCHE I (IMO: 9247390), SATINA (IMO: 9308778), and CROSS OCEAN (IMO: 9251810) are additional vessels managed and operated by Delnaz Ship Management Sdn Bhd.
Delnaz Ship Management Sdn Bhd is being designated pursuant to E.O. 13846 for having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services in support of, NIOC. The DIMITRA II, TYCHE I, SATINA, and CROSS OCEAN are being identified as property in which Delnaz Ship Management Sdn Bhd has an interest pursuant to E.O. 13846.
Panama-registered Diamante Tankers Incorporated is the owner, operator, and manager of the AVENTUS I (IMO: 9280873), which has been in involved in the transfer of Iranian petroleum products.
Diamante Tankers Incorporated is being designated pursuant to E.O. 13846 for, on or after November 5, 2018, having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services in support of NIOC. The AVENTUS I is being identified as property in which Diamante Tankers Incorporated has an interest pursuant to E.O. 13846.
Marshall Islands-registered Davina Shipping Inc is the owner, operator, and manager of the DAVINA (IMO: 9259367), which has delivered Iranian oil to the PRC.
Davina Shipping Inc is being designated pursuant to E.O. 13846 for, on or after November 5, 2018, having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services in support of NIOC. The DAVINA is being identified as property in which Davina Shipping Inc has an interest pursuant to E.O. 13846.
STATE DEPARTMENT DESIGNATIONS
The U.S. Department of State is also taking action against a number of entities in multiple jurisdictions involved in the illicit movement of Iranian petroleum.
Suriname-based Strong Roots Provider NV, Suriname-based Glazing Future Management NV, Suriname-based Engen Management NV, India-based Gabbaro Ship Services PVT LTD, Malaysia-based Alya Marine Sendirian Berhad, and Hong Kong-based Celia Armas Ltd are all being designated pursuant to 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 vessel BERG 1 (IMO: 9262168) is being identified as property in which Strong Roots Provider NV has an interest pursuant to E.O. 13846.
The vessel VORAS (IMO: 9203265) is being identified as property in which Glazing Future Management NV has an interest pursuant to E.O. 13846.
The vessel HORNET (IMO: 9197844) is being identified as property in which Gabbaro Ship Services PVT LTD has an interest pursuant to E.O. 13846.
The vessels SHANAYE QUEEN (IMO: 9242118) and CAROL (IMO: 9070072) are being identified as property in which Alya Marine Sendirian Berhad has an interest pursuant to E.O. 13846.
The vessel OCTANS (IMO: 9224295) is being identified as property in which Celia Armas Ltd has an interest pursuant to E.O. 13846.
SANCTIONS IMPLICATIONS
As a result of today’s action, all property and interests in property of these targets that are in the United States or in the possession or control of U.S. persons must be blocked and reported to OFAC. In addition, any entities that are owned, directly or indirectly, 50 percent or more by one or more blocked persons are also blocked. OFAC’s regulations generally prohibit all dealings by U.S. persons or within the United States (including transactions transiting the United States) that involve any property or interests in property of blocked or designated persons.
In addition, persons that engage in certain transactions with the individuals and entities designated today may themselves be exposed to sanctions or subject to an enforcement action. Non-U.S. persons are also prohibited from causing or conspiring to cause U.S. persons to wittingly or unwittingly violate U.S. sanctions, as well as engaging in conduct that evades U.S. sanctions. OFAC’s Economic Sanctions Enforcement Guidelines provide more information regarding OFAC’s enforcement of U.S. sanctions, including the factors that OFAC generally considers when determining an appropriate response to an apparent violation. Furthermore, unless an exception applies, any foreign financial institution that knowingly facilitates a significant transaction for any of the individuals or entities designated today could be subject to U.S. sanctions.
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 here. For detailed information on the process to submit a request for removal from an OFAC sanctions list, please click here.