Iran continues selling billions of dollars in crude oil to China despite US sanctions, using a hidden fleet of aging tankers that operate in international waters off Malaysia. These vessels mask their identities with tarps and black paint to conduct offshore ship-to-ship transfers, moving sanctioned oil to ships bound for Chinese refineries.

The operation unfolds in what mariners call a nautical no-man's-land, 45 miles from Malaysia's coast. Tankers sit low in the water waiting to offload cargo through thick hoses connecting two vessels. One such ship, the Catalina 7, was observed by Wall Street Journal reporters on May 8 as it transferred oil to another vessel whose name was concealed with black paint.

These clandestine transfers explain why Iran has maintained resilience against American economic pressure. By continuing oil sales, the regime generates essential hard currency even as negotiations stall over sanction relief. The US has so far refused to lift oil sanctions, but Iran's workarounds undermine this leverage.

The scheme reveals how sanctions evasion persists through maritime deception, complicating enforcement efforts. This shadow market demonstrates that Iran's oil revenue continues flowing despite Washington's attempts to isolate its economy.