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Difficult Times for Iran's Sanctions-Evading Oil Brokers

Moving and selling Iranian oil has gotten far harder under U.S. pressure (NIOC file image)
Moving and selling Iranian oil has become far harder under U.S. pressure (NIOC file image)

Published Oct 3, 2026 8:45 PM by The Maritime Executive

With the naval blockade preventing any Iranian tankers leaving the Gulf, for the last 10 weeks Iran has been selling oil from the stocks it had built up for just such a contingency which are being held afloat primarily off Malaysia and China.

Historically, Iran has sold 90% of its exports of crude to China. Chinese purchasers are still wary of being subject to US sanctions because these sanctions have global effect. To be sanctioned may entail being excluded from global dollar transactions, and thus impinge on wider business activity. So the Iranian brokers collude with the Chinese purchasers to disguise the origin of the oil being sold, and to hide the nature of the transactions which are used to pay for the oil. Chinese purchasers, normally from the independent teapot refineries of Shandong, have been happy to collude, because in exchange for taking on the risk of being sanctioned they receive a discount on the purchase price of the oil. 

But between the Iranian state entities owning the oil at source, and the final Chinese end-user and his refinery, is a network of middlemen and brokers, organizing the physical shipment of oil and the ship-to-ship transfers which are used to disguise its origin.  Often the same middlemen and brokers are then involved in channeling payments for the oil, masking the origin and destination of the payment, structuring and layering transactions through a series of front companies so that it can integrated back into the legitimate financial system without trace of its antecedents, with the nature of what has been paid for disguised.  The system for years has depended on a blind eye being turned to these transactions as they pass through the financial system, with certain governments either tolerant or complicit in jurisdictions where those profiting are closely connected to officials or ministers.

But for those middlemen and brokers who for years have skimmed profits from this sanctions evasion, times recently have become very hard. Because the product which is being bought and sold – sanctioned Iranian oil – is drying up fast, as stocks afloat are sold and run down.

These middlemen and brokers are known in Iran as trustees because they are entrusted with the State’s oil and then are expected to pay for it.  They are also trusted because they are closely connected to families in the highest level of the ruling clerical elite, and being privileged can travel and transact with the regime’s protection in a way most other Iranians cannot.  Besides not having product to sell, these trustees are now under major attack from two quarters. 

Firstly, notwithstanding their connections within the regime, the trustees face severe criticism even from Paydari hardline insiders, in a chorus which every Iranian joins, whatever their political views.  Indeed criticism of the trustees is one of the most unifying themes prevalent in Iran today, probably even more so than any animosity towards Israel or the United States.  The criticism comes from the skimming of the State’s oil and money as it passes through the trustees’ hands, or which they simply steal.  Many of the trustees, such as Babak Zanjani and Mohammed Hossein Shamkani on whom the Maritime Executive has previously reported, have become fabulously and ostentatiously wealthy.  Added recently to the list of prominent trustees under fire is Mostafa Ahadi from the IRGC’s Unit 600, believed to be the organizer of the Shayan network within the Ministry of Intelligence oil sales department, a network which has purloined huge sums from the State.

Fundamentalist Iranian MP Hussein Samsani makes a public attack on a trustee for misappropriating 56 million barrels of oil (Video posted on @mhmiranusa)

 

Secondly, Operation Economic Outcast is now sinking its claws into the network of front companies and financial institutions which the trustees and middlemen have used to conduct their business. Many of these front companies were registered in the United Arab Emirates and used banking facilities in the UAE. But the realization that these companies were generating funds for the IRGC, who in turn were attacking the UAE, encouraged the Emirati authorities to embark upon a clamp-down, in tandem with US Treasury sanctions action against banks such as the UAE branch of Banque Misr. 

Last week the US Treasury deepened this attack by sanctioning an extensive virtual network of financial sub-agents, all built and controlled centrally as part of the A7 network, which in effect is an underworld alternative banking system. Although Russian-controlled, the majority of these front entities are registered in Hong Kong.  Besides being used to manage Iranian dark fleet operations, the A7 network was used by ransomware gangs, North Korean hacking gangs and the IRGC Quds Force to fund overseas operations. 

The A7 network has developed its own ruble-backed token and custom-built VPN network. The US Treasury believes the sub-agents of the A7 network processed transactions worth $17 billion between January 2025 and June 2026, was processing on average 2,000 transactions per day, and in total handles 13% of Russia’s foreign trade transactions.

To make matters worse for the trustees, they are no longer able to hop on a plane and travel to meet contacts outside Iran.  As much of the money-laundering seeks to avoid using communications which can be intercepted by law enforcement, transactions agreed in face-to-face meetings have still been an important element of the sanctions-busting process, and are now much harder to set up due to U.S. sanctions on Iranian air travel.