A Tale of Two Sanctions Programs: U.S. Delivers Syria Relief While Launching Latest Economic Campaign Against Iran

On August 24, 2026, the U.S. government took sweeping actions in opposite directions on two long-standing sanctions programs: it extended further relief to Syria while opening an aggressive economic campaign against Iran. The Syria action follows the administration’s July 8, 2026 announcement that it intended to rescind Syria’s designation as a State Sponsor of Terrorism. By contrast, the U.S. Department of the Treasury (Treasury) frames its latest effort targeting Iran as a sustained, sector-by-sector squeeze on the country’s finances.

Syria: Further Sanctions Relief

The U.S. Department of State rescinded Syria’s designation as a State Sponsor of Terrorism and revoked the Specially Designated Global Terrorist designation of al-Nusrah Front, also known as Hay’at Tahrir al-Sham (HTS).

In coordination with that action, the Office of Foreign Assets Control (OFAC) removed HTS and more than 100 other individuals and entities from its Specially Designated Nationals (SDN) List. Parties on that list have their U.S. property frozen and U.S. persons may not do business with them, so removal lifts those restrictions. At the same time, OFAC designated two former HTS affiliates for their continued support of al-Qa’ida and Hurras al-Din — a reminder that relief for the broader Syrian government does not extend to actors still tied to those networks. OFAC also revoked Syria General License 25, a standing authorization which had permitted certain otherwise prohibited transactions involving HTS given its former role in the Syrian government; that license is no longer necessary now that HTS itself has been delisted.

Iran: Operation Economic Outcast

On the same day, Treasury launched “Operation Economic Outcast,” an economic campaign targeting Iran that Treasury Secretary Scott Bessent said is meant to “sever every economic lifeline that sustains this tyrannical regime.” As part of that effort, OFAC issued five sectoral sanctions determinations under Executive Order 13902, covering five sectors of the Iranian economy — digital assets, technology, gold, aviation, and shipping — expanding the U.S. government’s ability to impose secondary sanctions on foreign persons who operate in those sectors or provide material support to them. Secondary sanctions reach companies and individuals outside the United States that have no U.S. connection; rather than penalizing those parties directly, secondary sanctions cut them off from the U.S. financial system and U.S. markets.

OFAC also added nearly 60 individuals, entities, and vessels to the SDN List:

• Entities and individuals across the Middle East and East Asia were designated for their role in a procurement network supporting Iran’s Ministry of Defense and Armed Forces Logistics (MODAFL). According to Treasury’s press release, the network relied on front companies, hidden financial channels, and logistics intermediaries to obtain proliferation-sensitive technology for Malek Ashtar University of Technology and other MODAFL-affiliated end users, masking the true buyers to circumvent export controls.
• A cyber unit tied to Iran's Ministry of Intelligence and Security (MOIS) was designated over its record of breaching U.S. critical infrastructure systems and running financially motivated hacking operations.
• OFAC also targeted brokers, companies, and vessels — part of what is commonly called Iran’s “shadow fleet” — for their alleged role in transporting Iranian oil to foreign buyers, with proceeds funneled back to the Islamic Revolutionary Guard Corps-Qods Force and other parts of the regime.
• OFAC sanctioned several foreign companies operating in Iran’s oil sector for helping disguise the origin and movement of Iranian petroleum so it could reach international markets undetected.

The Annex below lists the new designations.

Taken together, the new designations show Treasury targeting both ends of Iran’s sanctions-evasion playbook: the front companies and intermediaries that convert oil revenue into weapons technology, and the shipping and trading networks that generate that revenue in the first place.

For companies with exposure, the harder question is who is actually blocked. Many of the newly designated parties are holding and front companies, and OFAC’s 50% Rule automatically blocks any entity they own 50% or more, individually or together, even if that entity never appears on the SDN List. Screening against the list alone may therefore miss blocked counterparties.

The Operation Economic Outcast announcement warns of heightened secondary sanctions and enforcement risk going forward, particularly for companies that keep doing business with the Iranian regime or that operate in Iran’s digital assets, technology, gold, aviation, or shipping sectors. Non-U.S. entities in those five sectors — technology suppliers, precious metals traders, aviation service providers, shipping agents, and digital asset platforms among them — now face risk based on the sector they work in, whether or not they have dealt with an already-designated party.

OFAC also suspended several general licenses issued under the Iranian Transactions and Sanctions Regulations, including authorizations for certain educational activities abroad, personal remittances, conference-related services, and academic and sports exchanges. To ease the transition, OFAC issued Iranian General License BB, which allows parties to wind down previously authorized transactions through 12:01 a.m. EDT on September 8, 2026, subject to conditions. It separately issued Iranian General License AA, authorizing certain activities involving La Nivernaise de Raffinage SAS, a France-based cooking oil refinery designated the same day.

For questions about this Blog or other sanctions and export control matters, please contact the authors or any of their colleagues in Arnold & Porter’s Export Control & Sanctions or White Collar Defense & Investigations practice groups.

Annex: Persons and Vessels Designated by OFAC on August 24, 2026

OFAC added the following individuals, entities, and vessels to the SDN List as part of Operation Economic Outcast, grouped by network as described in Treasury’s press release.

MODAFL Procurement Network (Middle East and East Asia)

• Sweet Ocean Industrial Limited (Hong Kong)
• Li Na (China)
• Tian Jianbai (China)
• Zhang Limei (China)
• RPT Technology Limited (Hong Kong)
• Shenzhen Sweet Ocean Technology Limited (China)
• Tiany Technology Limited (Hong Kong)
• MT Trading and Logistics HK Limited (Hong Kong)
• Feili Co Limited (Hong Kong)
• Minvur Limited (Hong Kong)
• Feisu Limited (Hong Kong)
• Guska Co Limited (Hong Kong)
• Vast Mart SDN BHD (Malaysia)
• HK Jiatai Technology Limited (Hong Kong)
• DEC Photonics Limited (Hong Kong)
• Noavaran Axis Private Joint Stock Company, a.k.a. BRE Line (Iran)
• Mohammad Hossein Aslani Moghaddam (Iran)
• Shenzhen Huamei Lianyun International Logistics Co Ltd (China)
• BRE International Logistics Corporation HK Limited (Hong Kong)
• Qiu Xingyu (China)
• Shenzhen Bositong Logistics Co Ltd (China)
• Bositong Supply Chain Shenzhen Co Ltd (China)

MOIS-Directed Cyber Actors

• Mojtaba Ghal’eh-Kuhi
• Keyvan Fayyaz Ghareh Blagh
• Saber Shahbazi Balujeh
• Mohammad Reza Kadkhoda’i
• Arman Kahzadian

Shadow Fleet Shipping Network and Oil Revenue Facilitators

• Mohammad Ahmed Suhil Fattouh, a.k.a. “Captain Hamzah” (UAE/Syria)
• Amdeh Ship Management and Operation Co. L.L.C (UAE)
• Ivan Obukhov (UAE/Ukraine)
• Foscom FZE (UAE)
• Azure Shipping PTE. LTD. (Singapore)
• Mansoor Tayabbhai Gandhi (Singapore)
• Arc Chartering Pte. Ltd. (Singapore)
• Sky Oil and Gas Asia Limited (Hong Kong)
• Almpertos “Alberto” Tsoris (Greece)
• Shipoil FZCO (UAE)
• Ship Fuels and Trade DMCC (UAE)
• Shipoil Limited (Hong Kong)
• Georgios “George” Tsoris (Greece)
• Good Luck Shipping LLC (UAE)
• Unique Oasis Shipping Services LLC (UAE)
• Target Horizon Shipping LLC (UAE)

Shamkhani-Linked Commodities Traders

• Wellbred Capital PTE. LTD. (Singapore)
• Wellbred Trading FZCO (UAE)
• Wellbred Trading SA (Switzerland)
• La Nivernaise de Raffinage SAS (France)

Shadow Fleet Vessel Owners

• Sifra Shipping Company (Marshall Islands)
• Vienna Shipping Co., Limited (Hong Kong)
• Riqueza Group Ltd (Hong Kong)
• Lilimoon Navigation Inc (China)
• Estanica Trading Ltd (United Kingdom)

Vessels Identified as Blocked Property

• SIFRA (IMO 9185346), Botswana-flagged LPG tanker — Sifra Shipping Company
• G SILVER (IMO 9139696), Cameroon-flagged LPG tanker — Vienna Shipping Co., Limited
• QUANTUM HOPE (IMO 9233650), Vanuatu-flagged crude oil tanker — Riqueza Group Ltd
• VOYAGE ELITE (IMO 9286138), Gambia-flagged crude oil tanker — Lilimoon Navigation Inc
• TELA (IMO 9189110), Gambia-flagged tanker — Estanica Trading Ltd

© Arnold & Porter Kaye Scholer LLP 2026 All Rights Reserved. This Blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.