US hits 2 Hong Kong-based energy firms with sanctions over Iranian oil

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asiafinancial.com

7th July 2022 – (Hong Kong) Washington has hit two Hong Kong companies with sanctions over sales and deliveries of oil from Iran to meet China’s energy needs.

The US Treasury cracked down on Hong Kong-based Lustro Industry, saying it hid its role in bulk purchases of petrochemical products.

Hong Kong-based Triliance Petrochemical Co Ltd, was also targeted through its dealings with Gulf-based Ali Almutawa Petroleum and Petrochemical Trading.

The two companies are accused by the US of being part of a network in China and the United Arab Emirates (UAE) that buys large amounts of Iranian oil despite sanctions on the country’s oil exports.

The US State Department on Wednesday also targeted a Vietnamese company, Truong Phat Loc Shipping Trading, and Singapore-based Everwin Ship Management, for transporting Iranian petroleum products.

Oil is the lifeblood of Iran’s economy and China’s energy imports have helped keep Tehran afloat.

The US is attempting to force Tehran to resume negotiations on its nuclear programme, through a mechanism known as the Joint Comprehensive Plan of Action (JCPOA).

US Sanctions ‘A Message to Beijing’

“I think the message to Beijing is as long as Iran is not taking a return to the JCPOA terms seriously, you need to stop importing Iranian oil,” Brian O’Toole, a former US Treasury official, said.

O’Toole said given Iran’s apparent hesitance to return to the nuclear deal, he expects Washington may lean more heavily on China, “because that was the clear point of leakage in the sanctions regime.”

Iran-based Jam Petrochemical Company was accused of exporting petrochemical products to companies throughout East Asia, many of which were sold to a US-sanctioned company for shipment to China.

Also targeted was UAE-based Edgar Commercial Solutions, which the Treasury said purchased and exported petrochemical products from sanctioned Iranian companies for shipment to China.

Wednesday’s move freezes US assets of those designated and generally bars Americans from dealing with them. Those who deal with the targeted people and entities may also be hit with sanctions.

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