The US sanctioned Chinese oil refineries. Now China is really pushing back

China has instructed its companies not to comply with U.S. sanctions targeting five Chinese oil refiners accused of trading Iranian fuel. This directive represents China's first use of a regulation designed to counter "improper" foreign actions and could complicate U.S. sanctions enforcement. The U.S. had imposed these sanctions since last year on entities and individuals involved in trading Iranian petroleum. This move by China signifies a significant response to U.S. extraterritorial sanctions, potentially escalating tensions in their economic relationship.

The U.S. Treasury Department’s Office of Foreign

The Trump administration has imposed sanctions on a major China-based oil refinery, Hengli Petrochemical, and approximately 40 shipping companies and tankers. This action, announced on Friday, targets entities involved in transporting Iranian oil, aiming to cut off Iran's revenue source. The Treasury Department stated that Hengli has received Iranian crude oil shipments since 2023, generating significant revenue for the Iranian military. These sanctions come shortly before a planned meeting between President Trump and Chinese President Xi Jinping. The U.S. also recently implemented a physical blockade on the Strait of Hormuz.