China is using a hidden funding conduit to pay Iran for oil, employing a barterlike mechanism that swaps Iranian crude for Chinese-constructed infrastructure, bypassing U.S. sanctions, The Wall Street Journal reported.
China is the top buyer of Iranian oil. According to some of the officials cited by the Journal, up to $8.4 billion in oil payments flowed through the system in 2024 to finance Chinese work on Iranian infrastructure projects.
Two Chinese entities are central to the arrangement: state-owned insurer Sinosure and a mysterious financial intermediary called Chuxin.
The report said Iranian oil is sold to a Chinese buyer tied to state trader Zhuhai Zhenrong and deposited with Chuxin, which pays Chinese firms working on insured projects inside Iran.
Chuxin does not appear on any official list of Chinese finance firms.
According to research lab AidData, China made over $25 billion in financial commitments to build infrastructure in Iran between 2000 and 2023.
"Iranian entities rely on shadow banking networks to evade sanctions and move millions," John K. Hurley, undersecretary of the Treasury for terrorism and financial intelligence, said last month while announcing sanctions on people and entities in the United Arab Emirates and Hong Kong for allegedly supporting Iran's military.
"Under President Trump's leadership, we will continue to disrupt these key financial streams that fund Iran's weapons programs and malign activities in the Middle East and beyond," he added.
Beijing's Foreign Ministry told the Journal it was "unaware of the arrangement" and "opposes illegal unilateral sanctions."
Trump in 2018 imposed U.S. sanctions on Iran after withdrawing from the Joint Comprehensive Plan of Action, also known as the Iran nuclear deal.
Zhenrong was sanctioned by the U.S. in 2019 for importing Iranian crude in violation of American restrictions on Iran's oil industry.
Neither Sinosure nor Chuxin has been hit with U.S. sanctions.
Solange Reyner ✉
Solange Reyner is a writer and editor for Newsmax. She has more than 15 years in the journalism industry reporting and covering news, sports and politics.
© 2025 Newsmax. All rights reserved.