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Greek Shipping Company Admits Guilt in Iranian Crude Oil Smuggling, Agrees to $2.4 Million Fine

SanctionsGreek Shipping Company Admits Guilt in Iranian Crude Oil Smuggling, Agrees to $2.4 Million Fine

A Greek shipping company has admitted guilt in smuggling sanctioned Iranian crude oil and has agreed to pay a $2.4 million fine, according to newly revealed U.S. court documents. This marks the first public acknowledgment by U.S. prosecutors of the seizure of approximately 1 million barrels of oil from the tanker Suez Rajan. This incident has exacerbated tensions between the U.S. and Iran, even as they negotiate the release of Iranian Americans held in Tehran in exchange for frozen Iranian assets in South Korea.

The court documents shed light on the covert world of Iranian crude oil smuggling amid Western sanctions since the collapse of the 2015 nuclear deal. The U.S. and its allies have been seizing Iranian oil cargoes since 2019, leading to attacks in the Middle East attributed to Iran and ship seizures by Iranian forces in the Strait of Hormuz, a critical global shipping route.

The case against Empire Navigation, the Greek company, relied on satellite images and documents to reveal efforts by the Suez Rajan to disguise its loading of Iranian crude oil as originating from another source. After months in the South China Sea, the ship sailed to the Texas coast, where it discharged its cargo to another tanker that released the oil in Houston.

Empire Navigation’s lawyer had previously pleaded guilty to violating sanctions on Iran in April. The U.S. Treasury has linked Iran’s oil smuggling to the Quds Force of the Revolutionary Guard, involving hundreds of vessels concealing their movements and ownership through foreign shell companies.

The unique aspect of the Suez Rajan case was its ownership by the Los Angeles-based private equity firm Oaktree Capital Management, which likely aided American prosecutors in pursuing the case.

The delay in unloading the Suez Rajan’s cargo had become a political issue for the Biden administration. Since the ship headed for America, Iran has seized two tankers near the Strait of Hormuz, including one with cargo for Chevron Corp. The U.S. Navy has increased its presence in the region, and recent warnings highlight the risk of Iranian forces illegally boarding and detaining commercial vessels in the area.

Despite U.S. sanctions, Iranian oil exports have remained relatively high this year, with China believed to be a significant buyer. Wallace called for a policy review to address the continued smuggling activities involving numerous vessels.

By FCCT Editorial Team

Disclaimer: The views expressed in this article are independent views solely of the author(s) expressed in their private capacity.

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