US Tightens Sanctions on Iran Oil Networks and Shadow Fleet

Arabian Post

2 days ago

United States authorities have implemented a sweeping array of sanctions targeting companies, vessels and networks that facilitate clandestine oil exports from Iran. The Treasury's Office of Foreign Assets Control moved to freeze assets and prohibit transactions by an Iraqi-led smuggling group and its associated Iranian 'shadow fleet.' Simultaneously, the State Department added further designations aimed at restricting Tehran's access to critical oil revenues.
The Treasury identified a complex smuggling operation orchestrated by Iraqi–British businessman Salim Ahmed Said, dating back to at least 2020. Said's firms specialise in blending Iranian crude with Iraqi oil before mislabelling shipments to evade sanctions. Vessels under his network, including tankers managed through UAE‑based VS Tankers FZE and VS Oil Terminal, have been instrumental in blending, ship‑to‑ship transfers and forging documentation to funnel oil into Western markets via Iraq or the UAE.
The crackdown also zeroed in on vessels involved in covert logistics operations. Tankers flying flags of Panama, Comoros, Cameroon and the Marshall Islands—such as VIZURI, FOTIS, THEMIS, and BIANCA JOYSEL—have collectively shipped tens of millions of barrels of Iranian oil, often suspending their AIS transponders during transfers in international waters.
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Secretary of the Treasury Scott Bessent said the sanctions are emblematic of an 'eighth round' of measures targeting Iran's petroleum and petrochemical sectors under Executive Order 13902. He emphasised that these actions aim to deny Tehran 'the financial resources that fuel its destabilising activities'.
Complementing this, the State Department designated six entities and four vessels under Executive Order 13846 for engaging in significant transactions involving Iranian petroleum, further amplifying legal consequences for those assisting Iran's oil trade.
The sanctions coincide with U. S. airstrikes on Iran's nuclear infrastructure. While President Trump hinted that sanctions relief could follow if Iran adopts a peaceful trajectory, Treasury and State Department actions signal a contrasting posture of escalation and enforcement.
Underpinning Tehran's tactics is what experts describe as a 'ghost fleet'—a web of shell companies, AIS manipulation and vessel flag‑hopping. This makes Iran's oil exports largely opaque and more difficult to police. The fleet's activities play a vital role in sustaining Iran's revenue streams, including funding for the Islamic Revolutionary Guard Corps‑Qods Force.
In the financial markets, the tightening of oil sanctions resonated swiftly. West Texas Intermediate crude prices edged above US$67 per barrel on Friday, spurred by expectations of tighter exports. However, analysts also pointed to anticipated increased output from OPEC+ in August as likely to mitigate sharp price movements.
Strategic observers say the latest round of sanctions is designed to maintain pressure on Tehran, even as broader diplomacy plays out. The U. S. has signalled its willingness to explore a new nuclear agreement, potentially including incentives such as civilian nuclear investment and sanctions relief, if Iran exhibits restraint and begins meaningful nuclear negotiations.
Critics argue, however, that while sanctions may narrow Tehran's financial margins, they can deepen its reliance on illicit networks. Tehran's pivot toward China, Russia and regional allies could be reinforced, with the shadow fleet evolving in sophistication despite the just‑announced sanctions.
Meanwhile, Iran's Deputy Foreign Minister Majid Takht‑Ravanchi has stated that Tehran will not initiate further strikes against the U. S., citing a preference for de‑escalation. He affirmed Iran's decision to respond proportionately to airstrikes but warned more aggressive engagement could provoke additional military, political or economic measures.
As diplomatic channels remain open, including planned talks in Oslo on nuclear constraints, sanctions authorities appear committed to preventing revenue flows that could support nuclear expansion or proxy activity. The U. S. approach suggests a concerted strategy of merging military pressure, sanction enforcement and back‑channel diplomacy to reshape Iran's calculus.