US targets LPG ships in latest sanctions aimed at Houthis, Hezbollah

The US Department of the Treasury announced a fresh round of sanctions on companies, ships and one individual involved in trading Iranian oil and LPG used to finance the Houthi rebels' attacks on commercial ships in the Red Sea, as well as one company accused of shipping LPG on behalf of Hezbollah in Lebanon.

The sanctions come after multiple attacks Aug. 13 on a Liberian-flagged oil tanker in the Red Sea that were confirmed by the Joint Maritime Information Center. Regional tensions stemming from the Israel-Hamas war continue to threaten oil supply routes.

"We will continue to use the tools at our disposal to deprive the Houthis of revenue to carry out their attacks on international shipping, and we will continue to confront Iran's enabling Houthi attacks," US State Department Principal Deputy Spokesperson Vedant Patel said Aug. 15 in a statement.

Iran's oil output holds steady

The actions are the latest attempt to stifle the network of Houthi financial official Sa'id al-Jamal. Treasury says the network is backed by the Islamic Revolutionary Guard Corps-Qods Force and is responsible for financing the Houthis' attacks on shipping and civilian infrastructure in the Red Sea.

The latest vessel sanctions name the LPG Om, Divine Power, and Raha Gas, whose captain, Arif Ibrahim Khot, was also designated.

Separately, Treasury sanctioned Kai Heng Long Global Energy Limited, which it said was the "ship manager, operator and registered owner" of two ships that the Lebanese Hezbollah-controlled Talaqi Group used to ship tens of millions of dollars worth of LPG to China. Four of its vessels, Fengshun, Victoria, Lady Liberty and Parvati, were sanctioned.

"Today's action underscores our continued commitment to disrupting Iran's primary source of funding to its regional terrorist proxies like Lebanese Hizballah and the Houthis," Bradley Smith, acting under secretary of the Treasury for terrorism and financial intelligence, said in a statement. "Our message is clear: those who seek to finance these groups' destabilizing activities will be held to account."

Despite the continuing drumbeat of US sanctions on Iran's oil industry, more of the country's crude output continues to make its way to market. The latest Platts OPEC+ survey by S&P Global Commodities Insights has Iranian crude production at 3.2 million b/d in July, steady from June but up from 2.7 million b/d in July 2023.