China's Hengli Petrochemical denies trade with Iran in response to US sanctions

• Hengli maintains it has never engaged in trade with Iran and all crude suppliers guaranteed oil origins comply with U.S. sanctions requirements
• The company reports sufficient crude oil inventories to meet processing needs for more than three months with procurement activities unaffected
• Hengli pledged to work toward lifting the U.S. sanctions, which it says lack factual and legal basis

Summary: Hengli Petrochemical Denies Iran Trade Following US Sanctions

Key Development:

Hengli Petrochemical, one of China's largest independent refiners, has categorically denied conducting any trade with Iran after the United States imposed sanctions on one of its subsidiaries for allegedly purchasing Iranian oil.

Company Response:

In a stock exchange filing issued Sunday, April 26, Hengli stated it "has never engaged in any trade with Iran" and emphasized that all crude oil suppliers have guaranteed their product origins fall outside US sanctions scope. The company asserts the US sanctions on its Hengli Petrochemical (Dalian) Refinery subsidiary "lack factual and legal basis" and has pledged to work toward lifting the restrictions.

Operational Impact:

Hengli reported its operations remain unaffected, with:

• Sufficient crude oil inventories to cover processing needs for over three months
• No disruption to crude oil procurement activities

Market Implications:

This development highlights escalating tensions in global energy trade as the US intensifies enforcement of Iranian oil sanctions. The case affects one of China's major independent refiners, a sector that has grown significantly in recent years and plays a crucial role in China's refining capacity.

The denial and company reassurances suggest Hengli is attempting to maintain market confidence while navigating geopolitical complexities. The situation underscores ongoing challenges for Chinese refiners operating in an environment where US sanctions enforcement can impact supply chains, even when companies dispute the allegations.

Sector: Energy/Petrochemicals

Company: Hengli Petrochemical

Location: Dalian, China