Client Alert: OFAC Continues to Target Iranian Shadow Fleet
On October 9, 2025, the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) announced sweeping designations of almost 100 vessels, a refinery, an oil terminal and shell companies all alleged to support Iran’s illicit oil trade. Acting pursuant to Executive Orders 13902 (targeting Iran’s petrochemical sector) and 13846 (reimposing Iranian sanctions by President Trump in his first term) this action reflects the United States’ ongoing and broad efforts to target Iran’s oil exports and choke off the revenues they bring to the regime.
This action was notable for its breadth, both in terms of geography and energy sector participants. Geographically, it targeted vessels, the shipping companies that owned them, and certain individuals who worked with them from all over the world, along with trading companies used to finance energy transactions, spanning China, Comoros, Gambia, Hong Kong, India, the Marshall Islands, Mongolia, Panama, Singapore, Sri Lanka, and the United Arab Emirates. In addition to the geographic diversity, the action also targeted different aspects of Iran’s energy program, including both oil and liquified petroleum gas (LPG) exports. These included a Chinese oil terminal and refinery as well as deliveries of LPG. Many of the designated financiers were UAE and Hong Kong based. The designations included the principals involved in the Iranian oil trade, companies and individuals who assisted them, and property (ships) in which they hold an interest.
Key Takeaways
The United States continues to apply pressure to choke off oil and LPG revenues from the Iranian regime. While this action includes many typical jurisdictions for Iranian oil trading (UAE, Hong Kong, China) it also includes companies and ships operating in jurisdictions far removed from Iran and the Middle East. We expect to see more actions like this one in the months to come, and companies—especially those involved in shipping—should be careful in their due diligence and operational controls.
The foregoing is for informational purposes only. It is not intended as legal advice and no attorney-client relationship is formed by the provision of this information.