OFAC targets an Iran LPG-smuggling and shadow-banking network across the UAE and China
Treasury names front companies relabelling Iranian LPG as Omani to move millions of barrels to South and East Asia
Summary
On 18 June 2026 the US Treasury's OFAC designated a network responsible for shipping hundreds of millions of dollars of Iranian liquefied petroleum gas using front companies in the UAE and China, foreign bank accounts and Iran's shadow fleet. Afghan national Sarbaz Abdul Zada and Turkish national Mohammad Shakol Mihandoust ran UAE front companies that exported millions of barrels to South and East Asia, often falsely labelled as Omani LPG. It extends a campaign in which OFAC sanctioned over 1,000 Iran-related persons, vessels and aircraft since February 2025, including the China-based Hengli teapot refinery. China still buys roughly 90% of Iranian oil exports.
By the numbers
- 100s of millions $, value of LPG moved by the designated network (Treasury).
- ~90%, share of Iran's oil exports bought by China.
- 1,000+, Iran-related persons, vessels and aircraft sanctioned since Feb 2025.
- 40, shipping firms and vessels OFAC tied to Iran's fleet in a May 2026 action.
Why it matters
LPG is a softer-policed cousin of crude; relabelling it as Omani lets Tehran bank hard currency despite maximum pressure. Naming the UAE and Chinese front-company layer tests whether third-country financial plumbing, not just tankers, can be squeezed after the ceasefire.
What to watch
- Whether UAE and Chinese banks de-risk from the named intermediaries.
- Asian buyers (India, Pakistan) swapping mislabelled cargoes for compliant supply.
- Any sanctions-relief offsetting under US issues 60-day Iran oil sanctions waiver talks.