US Hits Firms Moving Iranian Oil and Major China Crude Terminal

The latest US sanctions on Iranian oil targeted a unit of a state-owned Chinese major that is a major cog in global crude flows.

The Treasury Department on Thursday blacklisted Rizhao Shihua Crude Oil Terminal Co., among measures targeting more than 50 individuals, firms and vessels involved in exporting Iranian energy in a crackdown on the Beijing-Tehran energy trade. The facility is linked to Sinopec and handles about 9% of China’s crude imports.

By targeting the oil terminal, the Trump administration is signaling its intent to disrupt one of the largest remaining outlets for Iran’s sanctioned crude, much of which ultimately ends up in Chinese refineries despite US restrictions. The blacklisted entities helped facilitate billions of dollars in commodities sales, using shadow-fleet tankers, offshore terminals and middlemen from Asia to the Middle East, the agency’s Office of Foreign Assets Control said.

“The Treasury Department is degrading Iran’s cash flow by dismantling key elements of Iran’s energy export machine,” Treasury Secretary Scott Bessent said in a statement.

The move could impact non-sanctioned crude flows into China. The blacklisted operator, through its terminals, shipped in more than 1 million barrels a day from around the world last year, with Iran accounting for about 189,000 barrels of that, data from Kpler show.

Thursday’s designation by Washington is also the latest in a series that has targeted Chinese port infrastructure, including blacklisting operators of terminals in Qingdao and Yangshan ports. Since then, several of those have found workarounds to maintain those flows.

The moves on Rizhao Shihua and other port operators go beyond targeting buyers of Iranian crude — often independent, low-margin refiners, colloquially known as teapots, that often rely on cheaper, sensitive crude grades. China Petroleum & Chemical Corp., the official name for Sinopec, has vast operations across the port and owns a share in the terminal operator through subsidiaries.

Chinese Foreign Ministry spokesperson Guo Jiakun said countries’ cooperation with Iran was legitimate and urged the US to stop using sanctions, which he called “wrongful measures”.

“China will take necessary steps to uphold its own energy security, as well as the legitimate rights and interests of Chinese companies and citizens,” he said at a regular press briefing on Friday.

A press official at Sinopec didn’t respond to a request for comment.

Currently, tankers carrying almost 6 million barrels of crude are lingering off Rizhao, ship-tracking data show. The shipments are on four ships from Brazil, Russia, Venezuela and West Africa — reflecting the wide variety of grades that come into the port. Two of the vessels, the Pacific Sky and New Energy, have missed their estimated time of arrival, potentially indicating uncertainty regarding the measures.

“The question is whether these Chinese companies can build a firewall and deal only with other entities outside the reach of Western sanctions,” said Ben Cahill, an energy analyst at the University of Texas in Austin. “It does seem the Chinese national oil companies are quite wary of sanctions exposure, compared with independent refiners.”