(Bloomberg) -- The Trump administration announced sanctions against Iran's largest petrochemical company on Friday as part of an effort to choke off resources to the Islamic Revolutionary Guard Corps, an elite wing of the country's military that the U.S. named a terrorist organization earlier this year.
Treasury's Office of Foreign Assets Control sanctioned Persian Gulf Petrochemicals Industries Company over its ties to Khatam al-Anbiya, an arm of the IRGC, the department said in a statement on Friday. The company has awarded engineering, procurement and construction contracts to Khatam al-Anbiya, creating hundreds of millions of dollars in revenue for the IRGC, according to Treasury.
“This action is a warning that we will continue to target holding groups and companies in the petrochemical sector and elsewhere that provide financial lifelines to the IRGC,” Treasury Secretary Steven Mnuchin said in a statement.
Read more: U.S. Labels Iran's Guard Corps as Terrorists, Boosting Pressure
PGPIC and its subsidiaries hold 40% of Iran's total petrochemical production capacity and are responsible for 50% of Iran's petrochemical exports, according to Treasury.
The U.S. has been seeking new ways to ramp up pressure on Iran since President Donald Trump last year quit the multinational accord negotiated during President Barack Obama's administration that sought to constrain the country's nuclear program. While Obama's approach was to persuade Iran to change its behavior by strengthening its links with the rest of the world, Trump has taken the opposite approach with a bet that economic isolation will force the regime to switch course.
The Trump administration designated the IRGC as a “foreign terrorist organization” in April. It was the first time the U.S. had slapped that label on a government entity and is part of Trump's push to starve the regime of access to cash. The terrorism label means that anyone providing “material support” to the IRGC could face criminal prosecution.
To contact the reporter on this story: Joshua Gallu in Washington at jgallu@bloomberg.net
To contact the editors responsible for this story: Alex Wayne at awayne3@bloomberg.net, Joshua Gallu, Justin Blum
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