China issues prohibition order blocking enforcement of US sanctions on five refineries
The Ministry of Commerce declares the sanctions unrecognisable, citing infringements on national sovereignty and security interests.
China's Ministry of Commerce has issued a formal prohibition order directing that United States sanctions against five specific refineries shall not be recognised, enforced, or complied with. The directive targets facilities accused of importing Iranian oil, with the ministry stating that the measures improperly restrict business between Chinese enterprises and third countries in violation of international law.
The order specifically names Hengli Petrochemical (Dalian) Refinery alongside four other independent facilities known as 'teapot' refineries: Shandong Jincheng Petrochemical Group, Hebei Xinhai Chemical Group, Shouguang Luqing Petrochemical, and Shandong Shengxing Chemical. Beijing argues that these actions infringe upon national sovereignty, security, and development interests, rejecting the unilateral nature of the penalties which lack United Nations authorisation.
The targeted entities operate independently of state-owned giants such as Sinopec and generally function with narrow or negative margins. These smaller facilities specialise in processing heavily discounted crude from sanctioned nations, accounting for a quarter of China's total refinery capacity. The ministry emphasises that such operations are crucial for securing national oil supplies amidst tepid domestic demand.
The United States Department of the Treasury announced sanctions on April 24, designating Hengli as one of Tehran's most valued customers for generating hundreds of millions of dollars in revenue for the Iranian military. The Trump administration had previously imposed sanctions on the other four refineries included in the current prohibition order during the preceding year.
Data from commodities firm Kpler indicates that China purchased more than 80 per cent of the oil Iran shipped in 2025. With China obtaining more than half of its oil from the Middle East, a significant portion of which is sourced from Iran, the Ministry of Commerce maintains that these restrictions create unjustified hurdles for legitimate trade and the sale of refined products under correct place-of-origin markings.
By stipulating that the sanctions shall not be enforced, the Commerce Ministry seeks to safeguard the country's development interests against what it describes as a breach of basic norms governing international relations. The government has consistently opposed such unilateral measures, asserting that they fail to meet the foundational requirements of international law.
