Greek Shipping Company Fined $2.4 Million for Attempted Iranian Oil Smuggling

A Greek shipping company has admitted guilt in a case of smuggling sanctioned Iranian crude oil and has agreed to pay a hefty fine of $2.4 million, according to recently unsealed U.S. court documents reported by The Associated Press. The case revolves around Empire Navigation and, as part of the plea agreement, the company faces three years of probation.

This revelation marks a notable milestone as it represents the first public acknowledgment by U.S. prosecutors that the United States seized approximately 1 million barrels of oil from the tanker Suez Rajan.

The entire saga surrounding this ship has contributed to heightened tensions between Washington and Iran. This occurs even as both nations engage in negotiations regarding a trade involving billions of dollars in frozen Iranian assets held in South Korea, in exchange for the release of five Iranian Americans detained in Tehran. Additionally, the court documents provide a rare glimpse into the covert world of Iranian crude oil smuggling, which has expanded significantly since the collapse of the 2015 nuclear deal and the imposition of Western sanctions.

The U.S. and its allies have been actively seizing Iranian oil cargoes since 2019, resulting in a series of incidents in the Middle East attributed to the Islamic Republic. Furthermore, these actions have led to ship seizures by Iranian military and paramilitary forces, posing a threat to global shipping through the Strait of Hormuz, a critical passageway where 20% of the world's oil traverses.

The spotlight turned toward the Suez Rajan in February 2022 when the group United Against Nuclear Iran voiced suspicions that the tanker was transporting oil from Iran's Khargh Island, the primary oil distribution terminal in the Persian Gulf. Satellite images and shipping data analyzed by the AP at the time provided corroborating evidence.

The recently unsealed court documents heavily rely on satellite imagery and official records, demonstrating how the Suez Rajan attempted to conceal its load of Iranian crude oil from one tanker by falsely claiming it originated from another source.

For months, the vessel remained anchored in the South China Sea, off the northeast coast of Singapore, before embarking on an unexpected journey to the Texas coast. The cargo was subsequently transferred to another tanker, which later offloaded the oil in Houston. The court documents now confirm that the U.S. government indeed seized the oil.

Apostolos Tourkantonis, a lawyer representing Empire Navigation, had previously pleaded guilty in April to a single charge of violating sanctions on Iran. Notably, Empire, headquartered in Athens, Greece, has not responded to requests for comment.

The U.S. Treasury has asserted that the revenue generated from Iran's oil smuggling activities supports the Quds Force, the expeditionary unit of the Revolutionary Guard that operates across the Middle East. The court documents further underscore the involvement of the Revolutionary Guard in this illicit trade, which encompasses hundreds of vessels attempting to conceal their movements and ownership through foreign shell companies.

What sets the Suez Rajan case apart is its ownership. At the time of the transfer, it was owned by the Los Angeles-based private equity firm Oaktree Capital Management, which likely provided American prosecutors with a unique advantage in pursuing this case. It's worth noting that Oaktree, which has consistently declined to comment on the matter, sold the vessel to Empire in late May.