"Oil Trustees": How the IRGC Built a Multi-Billion Dollar Network of New Traders

Tehran has handed over millions of barrels of its oil to private brokers for sale outside traditional channels. Some of these brokers carry accumulated debts from previous sales yet still receive new shipments on credit and with exceptional discounts, illustrating the latest picture of a parallel economy created by sanctions that has turned evasion into an industry worth billions of dollars.

The website "Iran International" revealed that secret documents emerged in September showing internal dissent within Iranian state apparatuses regarding granting large quantities of crude oil on deferred payment terms to four individuals known as "oil trustees," despite their failure to return billions of dollars from previous sales proceeds.

One document, a letter from the Protection Unit of the Supreme National Security Council to the Ministry of Oil, showed that brokers received a discount of $8.5 per barrel, described in the letter as unusual. The documents place a former official in the Islamic Revolutionary Guard Corps (IRGC) intelligence, Mohammad Javad Bavand, at the center of the new oil sales system.

A State Handing Over Its Oil to "Trustees"

The use of brokers is not new in Iran. However, US sanctions, followed by the expansion of financial restrictions, moved them from the margins of the oil trade to its heart.
Tehran refers to these individuals as "trustees." They are persons and networks responsible for receiving crude oil, selling it, and moving its proceeds through companies and accounts outside the Iranian financial system, thereby reducing the ability of sanctions to track transactions.

But this mechanism produced an internal problem parallel to the sanctions themselves: the question of who guarantees the return of funds?

Ali Akbar Pour Ebrahim, former head of "Iran Oil Intertrade," estimated that up to $11 billion in oil revenues had not returned to the country after passing through broker networks. Additionally, Judiciary Chief Gholam-Hossein Mohseni-Ejei publicly acknowledged the issue of funds not returned by the "trustees," demanding that government agencies that authorized dealings with them assume responsibility.

Recent information points to names including Ali Payendrian and Mohammad Hadi Momenin, along with businessmen who shifted from commodity trading to oil, while some networks overlap with figures having security backgrounds or ties to the IRGC.

From Barrel to Empire

Mohammad Hossein Shamkhani, son of prominent Iranian official Ali Shamkhani, provides a model of the scale of business that can grow around the sanctions economy.
The US Treasury states that his network became a major player in Iranian oil exports before expanding into container shipping and global commodity trade.

In July, Washington expanded its sanctions to include more than 50 individuals, entities, and vessels linked to the network, bringing the total number of individuals, entities, and ships targeted under its umbrella to over 200.

One new Iranian document reveals a shipment of two million barrels transported to China on a tanker linked to the Shamkhani network, which later entered a financial dispute ending with the shipowner seizing control of the cargo, according to "Iran International."

This incident summarizes the danger of the model; the further oil moves away from official channels to evade sanctions, the greater the distance between the barrel and the Iranian treasury, widening the space for brokers, shell companies, debts, and disputes.

Money Does Not Return to Iran

But the most complex network appears in China, the primary destination for Iranian crude. Reuters revealed in September a mechanism that allowed Tehran to convert oil revenues estimated between $2 and $2.5 billion in one year into Chinese purchases and projects, without returning funds traditionally via international banks.

The cycle begins with Iranian oil and ends with a balance inside China. Approximately 70% of the money passing through one such mechanism is used to finance infrastructure projects, while the remainder enters special account mechanisms used to pay for goods Iran needs, ranging from medicines and cars to telecommunications equipment and contracts related to military hardware.

Thus, the question is no longer how Iran obtains its oil dollars, but rather: how does the barrel itself turn into a road, medicine, or military equipment without the dollar ever passing through Iran?

The Strait Closure Knot

According to observers, the war of 2026 exposed the limits of the entire system. After the re-imposition of the US blockade in July, Iranian crude and condensate loadings dropped from about 2 million barrels per day in March to between 220,000 and 255,000 barrels per day in August, according to estimates by firms "Kpler" and "Vortexa" cited by Reuters. Furthermore, approximately 41.7 million barrels accumulated on tankers behind the blockade line by August 26.

Here, the evasion economy collided with a geographical limit that shell companies cannot bypass. For years, Iran managed to change ship names, transfer oil between tankers, rotate companies and accounts, and hide payments. But when the tanker itself could not cross Hormuz, the broker's ingenuity was no longer sufficient.

The paradox reveals the other face of the "new IRGC traders"; sanctions created the need for them, secrecy increased their value, and granted them control over pathways through which billions of dollars flow. However, the war made the state more dependent on a smaller number of channels capable of keeping its trade alive.

Therefore, the Iranian dilemma is no longer just about the quantity of oil Tehran can sell, but about who holds the barrels, how much they are paid, and how much of the price returns to the state. In the sanctions economy, Iranian oil does not disappear; rather, the path taken by the money between the barrel and the treasury disappears.