On Friday, the US Treasury imposed sanctions on Hengli Petrochemical (Dalian) Refinery, accusing it of purchasing billions of dollars in Iranian oil. This action represents a significant escalation in the US's ongoing campaign to curb Iran's oil revenue, particularly as Hengli is the largest Chinese refiner targeted since the US renewed its crackdown on Iranian oil exports in 2019. The sanctions come after a 30-day waiver on Iranian crude oil imports expired and follow statements from US Treasury Secretary Scott Bessent warning of potential sanctions against Iranian oil buyers. Following the announcement, Hengli's shares plummeted by 10%. In response, Hengli Petrochemical denied the allegations, asserting that it has sufficient crude inventories and plans to continue transactions in Chinese yuan. The sanctions are expected to impact Hengli's operations and could further complicate China's oil trade with Iran, as the country remains the largest importer of Iranian oil. Beijing has consistently defended its trade relations with Iran, labeling US sanctions as illegal.