As part of its ongoing pressure campaign against Iran, the United States has imposed sanctions on four Indian firms, accusing them of facilitating the trade and transportation of Iranian petroleum products. The move is part of Washington’s broader effort to curb Iran’s oil sales, which it claims are used to fund destabilising activities in the region.

The US Department of the Treasury announced the new sanctions on February 24, stating that they target entities engaged in brokering, transporting, or managing vessels involved in the Iranian oil trade. The latest sanctions list includes oil brokers based in the United Arab Emirates (UAE) and Hong Kong, as well as tanker operators and managers in India and China.

Additionally, Iran’s National Iranian Oil Company and the Iranian Oil Terminals Company have been sanctioned, with US officials alleging that their operations help finance Iran’s military and proxy groups.

According to the US Office of Foreign Assets Control (OFAC) and the Department of State, the four sanctioned Indian companies are Flux Maritime LLP (Navi Mumbai), BSM Marine LLP (National Capital Region), Austinship Management Pvt Ltd (National Capital Region) and Cosmos Lines Inc. (Thanjavur)

Three of these companies—Flux Maritime, BSM Marine, and Austinship Management—have been sanctioned for acting as commercial or technical managers of vessels allegedly involved in transporting Iranian oil. Meanwhile, Cosmos Lines Inc. has been directly accused of facilitating the shipment of Iranian petroleum.

US officials argue that Iran continues to exploit a covert network of vessels, brokers, and shipping companies to evade restrictions and sustain its oil trade. US Secretary of the Treasury Scott Bessent stated:

"Iran continues to rely on a shadowy network of vessels, shippers, and brokers to facilitate its oil sales and fund its destabilising activities. The United States will use all our available tools to target all aspects of Iran’s oil supply chain, and anyone who deals in Iranian oil exposes themselves to significant sanctions risk."

Washington alleges that sanctioned Iranian oil tankers use ship-to-ship transfers in international waters to disguise the true origin of their cargo before delivering it to foreign buyers. The US claims that revenue generated from these transactions funds Iran’s military operations and proxy groups, which contribute to instability in the region.

Sanctions are restrictive measures imposed by one country or international body to limit or completely halt economic interactions with another entity. These restrictions can include -Trade bans (import/export restrictions), Asset freezes, Financial system exclusions (banning access to banking networks) and Travel bans and other penalties.

According to the Council on Foreign Relations, sanctions can be either comprehensive—such as the long-standing US embargo on Cuba—or targeted, affecting specific individuals, businesses, or industries.

The US has imposed economic sanctions on multiple countries, including Iran, North Korea, and China. Following Russia’s invasion of Ukraine, Western nations imposed some of the most extensive sanctions in history against Moscow, making it the most sanctioned country in the world.

Apart from individual nations, international bodies like the United Nations (UN) and the European Union (EU) also impose sanctions. However, these sanctions are only effective if enforced by individual member states. Critics argue that many countries find ways to bypass sanctions, reducing their overall impact.

Sanctions are intended to pressure targeted countries or entities into altering their behaviour by inflicting economic hardship. However, their effectiveness remains widely debated. While they can disrupt economies, governments often find alternative trade partners or adopt countermeasures.

For example, despite severe Western sanctions, Russia’s economy has remained resilient, as countries like India and China continue trading with Moscow. Similarly, while Iran faces significant restrictions, it has managed to maintain oil exports through indirect trade routes and middlemen.

The latest US sanctions targeting four Indian firms mark an escalation in Washington’s efforts to clamp down on Iran’s oil trade. While these measures aim to cut off funding for Iran’s regional influence, their long-term impact remains uncertain. Given the historical ability of sanctioned entities to find alternative trading methods, the effectiveness of such economic restrictions will likely continue to be a subject of debate in global diplomatic and economic circles.