The United States has imposed a fresh wave of sanctions on Iranian petroleum exports, striking a significant blow to China’s state-owned oil giant Sinopec by blacklisting a key terminal that handles nearly one-fifth of its crude oil imports. The announcement, made on Thursday, comes just weeks before a scheduled meeting between U.S. President Donald Trump and Chinese President Xi Jinping, further heightening tensions between the world’s two largest economies.
At the center of the sanctions is the Rizhao Shihua Crude Oil Terminal Co. Ltd, located in Lanshan, Shandong province, a major oil hub where Sinopec imports roughly 804,000 barrels of crude per day. The U.S. Treasury said the terminal was used to receive Iranian oil shipments from sanctioned vessels, a claim that puts one of China’s most critical energy gateways under intense scrutiny.
The Rizhao terminal is half-owned by Sinopec Kantons Holding, a logistics subsidiary of Sinopec, while the remaining shares belong to the Shandong Port Group’s Rizhao Port, backed by local authorities. The site operates three berths capable of docking Very Large Crude Carriers (VLCCs), each able to handle up to 2 million barrels of oil.
Analysts say the sanctions could disrupt crude discharges around Rizhao, forcing vessels carrying non-sanctioned oil to seek alternative ports in Shandong, home to many of China’s independent refiners. “Compared to previous sanctions on Chinese terminals, the impact could be larger,” said Samuel Kong, senior analyst at FGE, who noted that 10–20% of Rizhao’s imports originate from sanctioned sources.
The move brings to five the number of sanctioned oil import terminals in Shandong, which collectively account for about half of the province’s VLCC handling capacity. The area remains China’s largest destination for crude shipments from Iran, Venezuela, and Russia, all under varying levels of U.S. sanctions.
Shipping markets responded swiftly, with spot freight rates for the Middle East–China VLCC route rising by 3% on Friday, driven by concerns of port congestion and unloading delays following the new restrictions.
While Sinopec has reportedly avoided direct purchases of Iranian oil, traders and analysts say the sanctions could still hamper its supply chain operations and complicate logistics for crude imports handled via Rizhao.
Neither Sinopec, Shandong Port Group, nor Rizhao Port immediately commented on the development, while industry observers warned that the restrictions could strain China’s refining operations and further intensify trade frictions with Washington.
The sanctions also follow China’s recent tightening of rare earth export controls, signaling a widening economic standoff between the two powers as both seek leverage in ongoing trade and geopolitical negotiations.
For now, the spotlight remains on Rizhao Shihua, a key artery in China’s oil supply chain—its future operations uncertain amid escalating U.S.–China tensions and renewed global focus on Iran’s sanctioned oil trade.