Treasury Targets Iranian LPG Smuggling Network as U.S. Pressure Campaign Intensifies

On Friday, the Trump administration announced a new set of sanctions against an international network accused of smuggling Iranian liquefied petroleum gas (LPG) and laundering profits through hidden banking channels. This move is part of the U.S. effort to reduce Iran's energy exports and financial support.

The sanctions were revealed by the U.S. Treasury Department's Office of Foreign Assets Control (OFAC). They focus on a group of traders, shipping companies, boats, and financial intermediaries believed to be involved in moving large sums of Iranian LPG disguised as exports from Oman, which is then sold to buyers in South and East Asia.

This action comes as the U.S. ramps up its maritime enforcement against vessels connected to Iran's energy trade, including several recent boardings of sanctioned tankers in the Indian Ocean.

Treasury Secretary Scott Bessent stated, "Iran's economy is struggling and its military is weakened. Through Economic Fury, Treasury will keep breaking apart Iran's shadow fleet, shadow banking systems, and access to global trade."

The Treasury claims that the network used front companies in the United Arab Emirates and China, along with foreign bank accounts and ships linked to Iran’s so-called shadow fleet, to hide the source of Iranian LPG shipments and evade sanctions.

Two key players in this network are identified as Afghan national Sarbaz Abdul Zada and Turkish national Mohammad Shakol Mihandoust. Officials say they used several trading firms based in the UAE, such as Butani Trading LLC, Dundlod Trading FZE, and ADH Energy FZE, to arrange shipments of Iranian LPG falsely labeled as Omani products.

One shipment mentioned by the Treasury involved around 750,000 barrels of LPG sent to Bangladesh via the LPG carrier Sevan. This vessel is said to have transported Iranian-origin cargoes between August and November 2025. Another shipment included 22,000 metric tons of LPG delivered to Bangladesh in October 2025.

The sanctions also include Shanghai Qianye Energy Co., Ltd., a company in China that the Treasury claims is controlled by Mihandoust.

Besides the trading network, OFAC sanctioned six LPG tankers and their owners and operators. The vessels include MD 23, Glendale, Amir Gas, Gas Lagoon, Mile, and Gaz GMS. The Treasury alleges that these ships transported millions of barrels of Iranian LPG over several years.

The Treasury also sanctioned an Iranian exchange house named Mehrdad Geramian Nik and Partners Company and its leaders, accusing them of handling hundreds of millions of dollars in foreign currency for sanctioned Iranian banks, including Bank Tejarat, Bank Mellat, and Bank Pasargad.

This exchange house is seen as part of Iran's wider "shadow banking" system, which uses overseas shell companies, intermediaries, and foreign accounts to carry out international transactions while hiding connections to sanctioned Iranian entities.

These latest sanctions are part of the administration's "Economic Fury" campaign, which aims to restrict Iran’s ability to generate and use revenue from oil, gas, petrochemical, and financial activities.

The sanctions also highlight the increasing importance of maritime enforcement in U.S. policy regarding Iran. Since April, U.S. military forces have conducted multiple operations against sanctioned tankers, expanding their efforts beyond the Persian Gulf into the broader Indian Ocean to enforce restrictions on Iranian energy exports.

The State Department stated that the U.S. will continue to target companies, vessels, and financial institutions that help in avoiding sanctions.

State Department spokesperson Tommy Pigott said, "These sanctions are part of the Administration's Economic Fury campaign, which keeps maximum pressure on the Iranian regime and disrupts its ability to raise funds for weapons development, support for terrorist groups, and regional aggression."