The United States Treasury Department has announced new sanctions on a global shipping network accused of moving Iranian oil under false labels. According to the Treasury, the group was run by an Iraqi-Kittitian businessman, based in the United Arab Emirates, who managed the operations through his company Babylon Navigation DMCC.
Officials explained that the network’s method was simple but highly deceptive. Tankers secretly blended Iranian oil with Iraqi oil. Once mixed, the oil was falsely marketed as being from Iraq alone. By disguising the origin, the network aimed to evade American sanctions that are designed to cut off revenue from Iran’s oil industry.
To carry out the blending, tankers reportedly transferred oil at sea, especially in the Arabian Gulf. Transfers also took place in Iraqi ports, which helped make the shipments look legitimate. By doing so, the network allowed Iranian oil to be sold on the global market without drawing suspicion.
Several vessels were directly linked to this activity, including tankers named Adena, Liliana, and Camilla. These ships sailed under Liberian flags but were tied to Babylon Navigation’s network. Many tankers sail under the Liberian flag because Liberia is known as a “flag of convenience.” This means ship owners register their vessels there for cheaper fees, lighter regulations, and less international scrutiny.
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Companies and Vessels in the Spotlight
The Treasury said it had blacklisted multiple companies and vessels for their role in the scheme. The main operator was Babylon Navigation DMCC, based in the UAE, which coordinated the ships involved and managed the business activities of the sanctioned Iraqi-Kittitian businessman.
To make it harder to trace ownership, the businessman and his associates reportedly used other firms registered in offshore locations. These included several companies based in the Marshall Islands, such as Tryfo Navigation, Keely Shiptrade Limited, Odiar Management S.A., Panarea Marine S.A., and Topsail Shipholding Inc. Offshore companies are businesses registered in foreign countries, often in places like the Marshall Islands. They are legal but can make it very difficult to find out who truly owns or controls the company.
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These companies acted as registered owners of the tankers. According to the Treasury, this tactic was likely meant to hide the true extent of the businessman’s control. By spreading ownership across different firms and countries, the network could create confusion and keep its activities hidden for longer.
The sanctions mean that all property or assets belonging to these companies and vessels in the United States are now blocked. U.S. citizens and entities are also prohibited from doing business with them.
US Message on Iran’s Oil Revenue
American officials said the new sanctions are part of a broader effort to limit Iran’s ability to generate income through oil sales. Oil revenue is the main source of income for Iran, accounting for a large share of its national budget. Limiting this flow of money directly affects the government’s ability to fund projects and activities abroad. They stressed that revenue from oil exports has been a major source of funding for activities the U.S. considers hostile.
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In a statement, Treasury Secretary Scott Bessent said the United States will continue to act against attempts to disguise or move Iranian oil in violation of sanctions. He emphasized that targeting Iran’s oil networks reduces the regime’s ability to finance operations against the United States and its allies.
Officials also underlined that the U.S. remains committed to keeping the oil market free from Iranian supply. They said Washington will persist in its efforts to uncover and disrupt methods that Tehran uses to bypass restrictions.
Iran’s representatives did not immediately respond to the sanctions announcement. The move comes while talks around Iran’s nuclear program remain stalled.
With these measures, the U.S. has made clear that it is closely watching global shipping routes, companies, and tankers linked to Iranian oil. By blocking these networks, Washington aims to put additional pressure on Tehran while cutting off the profits generated from disguised oil sales.