What is OFAC and how does it enforce Iran sanctions?

The Office of Foreign Assets Control (OFAC) is a US Treasury agency that enforces economic and trade sanctions against Iran by maintaining a Specially Designated Nationals list and using secondary sanctions authority to target non-US entities that transact with sanctioned Iranian parties.

Why are Iran oil sanctions failing in 2026?

Iran is exporting close to 1.5 million barrels per day despite sanctions, primarily because China purchases roughly 90% of Iranian oil through intermediary companies in Malaysia and the UAE that repackage it as non-Iranian crude, making enforcement extremely difficult.

What are secondary sanctions and why do they matter?

Secondary sanctions allow the US to penalize non-American companies and banks that do business with Iran, even if those entities have no US connections. They are the primary enforcement tool but are increasingly challenged by Chinese state-owned entities that are willing to absorb the risk.

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Why Iran Sanctions Are Failing

Despite comprehensive US sanctions reimposed in 2018, Iran is exporting close to 1.5 million barrels of oil per day as of 2026 — near its highest level since sanctions began. The primary reason is China's willingness to purchase Iranian oil through a network of intermediary companies that obscure the origin of the cargo, effectively nullifying the sanctions regime for Iran's most important revenue stream.