China defies US sanctions, shields teapot refineries tied to Iran

China’s Commerce Ministry issued a prohibition order blocking US sanctions on five small, independent Chinese refineries known as 'teapot' refineries that were accused of importing Iranian oil, saying the measures violate international law and should not be recognized or enforced. The targeted refineries are Hengli Petrochemical (Dalian) and four others (Shandong Jincheng, Hebei Xinhai, Shouguang Luqing, Shandong Shengxing). The US Treasury had sanctioned Hengli and the others for dealings with Iran; teapot refineries, though smaller than state-owned plants, account for about a quarter of China’s refinery capacity and rely on discounted crude from sanctioned countries, with sanctions complicating product sales and origin labeling.