The United States is struggling to stop Iran from secretly selling its oil, even though it has imposed strict sanctions on Tehran. Recent reports suggest that Iranian ships are conducting oil trade in Malaysian waters, which is especially advantageous for China. Despite the U.S. sanctions, the trade of Iranian oil continues to be active in Southeast Asia, particularly off the coast of Malaysia. Tankers in this area are performing cargo transfers from one ship to another, a common practice in the maritime industry that Iran’s clandestine fleet is using to bypass international sanctions, according to The New York Times. These operations allow the transportation of millions of barrels of crude oil to foreign buyers, mainly China, and have wide-reaching effects on the global oil market. Iranian oil is often sold at a lower price, which affects the price of crude oil and harms competing companies. In addition, the ships used for these transfers are often old, increasing the risk of accidents. The United States is in a tough spot. Faced with this situation, the U.S. government is exploring other ways to pressure Tehran into compliance. Beyond targeting Iranian tankers, the White House now plans to focus on companies that help Iran conduct its trade. Maritime brokers, fuel suppliers, port service providers, and financial intermediaries are among the potential targets. U.S. Treasury Secretary Scott Bessent announced these sanctions in August, and they are expected to act as a deterrent: the targeted companies risk losing access to dollar transactions, being unable to pay suppliers, and being excluded by banks and business partners. Malaysia is also in a delicate position. The country does not recognize the legitimacy of U.S. sanctions against Iran, with which it maintains strong relations, similar to its relationship with Beijing, Iran’s main oil buyer and Malaysia’s main trading partner. From Kuala Lumpur, authorities point to practical and legal challenges in monitoring operations in this maritime area, which is beyond the country’s territorial waters but within its exclusive economic zone. Despite U.S. pressure, Malaysia has largely allowed this trade to continue. Missiles, drones, and other risks are present on board the tankers trying to pass through the Strait of Hormuz. Thanks to its “ghost fleet,” Iran continues to sell its oil, despite U.S. sanctions. Malaysian companies have concerns: according to national law, trading with Iranian ships is not necessarily illegal. However, they risk financial consequences from the U.S. At the same time, some professionals in the industry refuse to see Iranian crews as enemies, arguing that the sailors, who are mostly not Iranian, are simply trying to earn a living. They question the moral justification for refusing to provide them with clean water or food. The unpopularity of the United States in Malaysia, reinforced by the war in Gaza and the conflict with Iran, only strengthens this position. Washington’s strategy clearly has its limits. Experts estimate that U.S. measures so far have not significantly reduced the flow of Iranian oil. Even if authorities manage to disrupt the operations, the trade could simply move to other areas, such as Indonesian waters. As long as Chinese demand remains strong, local support networks continue to operate, and profits are high, it will be extremely difficult for the United States to make its sanctions more effective.