US Treasury Secretary Scott Bessent announced Friday that the United States will not renew waivers allowing the purchase of Russian oil and petroleum products currently at sea. According to reports from The Associated Press, Bessent also ruled out renewing the one-time waiver for Iranian oil at sea, stating 'Not the Iranians' and explaining that 'We have the blockade, and there's no oil coming out.' The Treasury Secretary indicated that Iranian production shutdowns are expected within two to three days, which he warned would be 'very bad for their wells.' Bessent emphasized during a White House press briefing on April 15 that the administration has told countries 'that if you are buying Iranian oil, that if Iranian money is sitting in your banks, we are now willing to apply secondary sanctions, which is a very stern measure.' The sanctions come just a few weeks before President Donald Trump and China's Xi Jinping are due to meet in China.
The Trump administration has significantly escalated its Iran oil sanctions campaign by targeting a major Chinese refinery and approximately 40 shipping companies and tankers involved in transporting Iranian crude. According to reports from The Associated Press, the sanctions include Hengli Petrochemical's facility in Dalian, which processes roughly 400,000 barrels of crude oil per day and has been receiving Iranian shipments since 2023. The Treasury Department alleges that Hengli has generated hundreds of millions of dollars in revenue for the Iranian military, making it one of the biggest independent refineries in China. This move represents the Trump administration's threat to impose secondary sanctions on companies and countries doing business with Iran, as part of the Republican administration's overall campaign to cut off Iran's key revenue source. The advocacy group United Against Nuclear Iran confirmed in February 2025 that Hengli is one of dozens of Chinese purchasers of Iranian oil, highlighting the scale of China's involvement in Iranian oil trade. China is the biggest buyer of Iranian oil, importing 80% to 90% of Iranian oil before the US-Israeli war broke out, though the crude is often transported by a shadow fleet with obscured origins.
The expanded sanctions come amid heightened global tensions, with the world on edge over the US-Israeli war in Iran and global energy markets disrupted by the closure of the Strait of Hormuz. As reported by The Times of India, the US originally issued the waiver for Russian oil sales and petroleum products in March with the intent of stabilizing global energy markets after crude oil prices surged above USD 100 per barrel. The Treasury Department had previously renewed the waiver two days after Bessent indicated he had no plans to extend sanctions relief. The sanctions come as global energy trade is in turmoil as war around the Persian Gulf chokes off oil and natural gas shipments, causing prices to soar significantly. The US has concurrently imposed a physical blockade on the Strait of Hormuz, the Persian Gulf waterway that is crucial to global energy supplies. Treasury Secretary Bessent explained during the World Bank and International Monetary Fund meetings that 'I wouldn't imagine that we'd have another extension' and noted that 'I think the Russian oil on the water has been largely sucked up.'
Treasury Secretary Bessent announced that his agency 'will continue to constrict the network of vessels, intermediaries and buyers Iran relies on to move its oil to global markets.' According to The Times of India, during the World Bank and International Monetary Fund meetings last week, Bessent explained his previous change of heart regarding the waivers. More than 10 of the most vulnerable and poorest countries approached him seeking assistance, leading to the initial waiver issuance. However, Bessent indicated that 'I wouldn't imagine that we'd have another extension' and noted that 'I think the Russian oil on the water has been largely sucked up.' The Treasury Department has also sent letters to financial institutions in China, Hong Kong, the UAE and Oman threatening to levy secondary sanctions for doing business with Iran. China has responded to previous sanctions, with embassy spokesperson Liu Pengyu stating that the sanctions 'undermine international trade order and rules, disrupt normal economic and trade exchanges, and infringe upon the legitimate rights and interests of Chinese companies and individuals.' China has disagreed with previous US sanctions, but its major companies and banks still comply with US sanctions because they are more exposed to the US-dominated financial system.
