The US Treasury Department on Friday sanctioned five individuals and three companies accused of helping fund Hezbollah through a Lebanon-based sanctions evasion network allegedly backed by Iran’s Revolutionary Guards’ elite Quds Force.
“These evasion networks strengthen Iran and its proxy Hezbollah and undermine the courageous efforts of the Lebanese people to build a Lebanon for all its citizens,” said Bradley T. Smith, Acting under secretary for terrorism and financial intelligence in a statement.
The individuals and companies designated are part of a network of revenue-generating commercial enterprises owned or controlled by Hezbollah that facilitate and mask oil sales for the IRGC's Quds Force while also providing Hezbollah with crucial access to the formal financial system, according to the Treasury.
The network, it said, was overseen by senior Hezbollah finance officials including Muhammad Qasir until his death in late 2024 and his son-in-law Muhammad Qasim al-Bazzal.
The Treasury said the network used front companies to disguise oil sales and other business activity that generated millions of dollars for Hezbollah.
It added that US Department of State’s Rewards for Justice program is also offering up to $10 million for information that leads to the disruption of Hezbollah’s financial networks.
The US sanctions come on the same day Israel launched a major airstrike on southern Beirut for the first time since a November ceasefire in what it says was a response to a rocket attack from Lebanon.
The strike hit a building in Beirut’s southern suburbs in the Dahiyeh area which Israel said was used to store drones by the Iran-backed Shi’ite militant group.
An analysis of discrepancies between tanker tracking data and China’s customs records shows Iran is using forged documents not only from Iraq, but also from the United Arab Emirates, Oman and especially Malaysia to export oil to China.
Hayyan Abdul-Ghani, Iraq’s oil minister, recently said that Iranian tankers use forged Iraqi documents to circumvent sanctions and the issue has been reported to the United States. Iran’s oil ministry dismissed these remarks as “negative and malicious propaganda.”
The Iraq case
Regarding Iraq specifically, data from Kpler, a commodity intelligence firm, and Iraqi domestic sources indicate that last year Iraq exported 1.19 million barrels per day (mbpd) of crude oil to China.
However, Chinese customs reported receiving 1.276 mbpd from Iraq.
In simpler terms, Iran disguised a total of 31 million barrels of its crude oil (equivalent to 86,000 bpd) as Iraqi oil and shipped it to China last year.
Statistics indicate that the practice has been underway since at least 2023. However, formal acknowledgment by Iraqi officials appears to have followed the tightening of Iran sanctions enforcement by the new US administration under President Donald Trump. Abdul-Ghani also noted that Baghdad has received reports of US naval forces seizing tankers in the Persian Gulf carrying Iraqi documents, but said Washington has been informed the documents are forged.
Iran’s LPG, mazut exports under the Iraqi brand
Since 2016, Iraq has been an LPG exporter. Kpler’s data shows that Iraq’s LPG exports surged last year, primarily due to the launch of a new oil refinery in Baghdad.
This development has further enabled Iran to sell its own LPG under Iraqi brand.
While China—importing a third of Iraq’s oil—does not purchase Iraqi LPG, but other Asian countries like Bangladesh do.
Several months ago, the head of Bangladesh’s Association of LPG Traders and Distributors sent a letter to the government and the central bank, warning about the entry of Iranian LPG shipments into the country with forged documents. The letter specifically mentioned a 10,000-ton LPG shipment carried by the vessel G YMM, which arrived in August under the branding of Iraq’s Basra Gas Company. However, in September of last year, the Basra Gas Company told Bangladesh’s Business Standard newspaper that this vessel had never loaded cargo from Iraq.
Additionally, Lloyd’s Listrecently estimated that over half of LPG cargoes claiming Iraqi origin may actually be Iranian.
Kpler data seen by Iran International reveals that Iran’s daily LPG exports soared to 330,000 bpd last year—2.5 times the 2020 level. Annual revenue from LPG exports (propane and butane) exceeds $10 billion, making it a significant component of Iran’s petroleum exports.
Previously, Reuters cited industry and trade sources in reporting a complex network in Iraq used for exporting Iranian fuel oil (mazut).
Kpler’s data shows that Iran loaded 230,000 bpd of mazut last year for export. This is a significant portion of its daily shipments of crude and other oil products.
There have been numerous reports about Iran’s use of forged documents to export oil and petroleum products under the names of the UAE, Oman, and particularly Malaysia.
The peculiar case of Malaysia
Kpler previously told Iran International that around 60% of Iran’s oil reaches China under the label of Malaysian crude.
Commenting on Iran’s rebranding tactics, the tanker-tracking firm TankerTrackers told Iran International: “Apart from Chinese data, there is no definitive way to determine the exact volume of rebranded Iranian oil. However, discrepancies in China’s import figures reveal the pattern—for example, when customs report 1.5 million barrels per day from Malaysia, but Malaysia’s actual exports are only a fraction of that.”
Samir Madani, an analyst at the firm, added: “If ship-to-ship transfers occur near Iranian waters and then head directly to China, the oil is most likely recorded as Iraqi or Omani crude. If the transfers take place in Riau, it’s reported as Malaysian.”
One striking discrepancy: Malaysia produces less than 570,000 barrels per day, yet Chinese customs data shows it imported 1.4 million barrels per day from Malaysia last year. Much of that volume is Iranian oil, along with some sanctioned Russian and Venezuelan crude.
Since US oil export sanctions were imposed on Iran in 2018 and 2019, Malaysia’s oil production has actually declined by 20%. Yet, its crude oil exports to China have increased eightfold over the same period.
Neither the Malaysian nor Chinese government has offered an explanation for how Malaysia’s exports to China are triple its total production capacity. The discrepancy, however, underscores the previous US administration’s broad leniency under President Joe Biden in enforcing sanctions against the Islamic Republic.
