Chinese Refinery Accused of Billions in Iranian Oil Purchases
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Chinese Refinery Accused of Billions in Iranian Oil Purchases
- Hengli Group's refining unit was sanctioned by the U.S. Treasury in April 2026 for allegedly purchasing billions of dollars worth of Iranian petroleum.
- Founded in 1994 by Chen Jianhua, Hengli Group has grown from a small weaving factory into a vast conglomerate with interests in petrochemicals, textiles, and refining.
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Hengli Group, a major Chinese privately held company, is facing accusations from the U.S. Treasury of being a significant buyer of sanctioned Iranian crude oil. The U.S. Treasury sanctioned Hengli’s refining unit in April 2026, alleging that the company had purchased billions of dollars of Iranian petroleum.
Hengli has denied these claims, stating it complies with regulations in the markets where it operates and that its suppliers provide similar assurances. However, industry analysts, shipping brokers, and U.S. officials identify Hengli as a key player among China’s independent “teapot” refineries that acquire discounted sanctioned crude. Shipping data reviewed by the Wall Street Journal reportedly indicates that sanctioned tankers delivered over five million barrels of Iranian crude to Hengli from 2023 onwards.
China’s Commerce Ministry, in May 2026, instructed companies not to comply with the U.S. blacklisting of Hengli and other refiners, with Beijing asserting its opposition to unilateral U.S. sanctions and its commitment to protecting China’s energy security.
Hengli Group, founded in 1994 by Chen Jianhua and Fan Hongwei, began as a small weaving factory in Suzhou, Jiangsu. Under Chen Jianhua’s leadership, the company has expanded significantly, becoming one of China’s largest private enterprises with operations in oil refining, petrochemicals, polyester materials, and textiles. In 2025, Hengli Group ranked 81st on the Fortune Global 500 list, reporting a 2024 revenue of US$121.126 billion. Its refinery on Changxing Island is among China’s five largest and generates approximately $30 billion in annual revenue.