China’s National Financial Regulatory Administration (NFRA) has advised major banks not to issue new loans to five oil refineries recently added to the US sanctions list for alleged involvement with Iranian oil. The directive, reported by Bloomberg News, also instructs banks to review their business dealings with these refineries but not to recall existing loans immediately.

Among the sanctioned companies is Hengli Petrochemical (Dalian) Refinery, one of China’s largest private refineries. The report suggests that Beijing’s cautious stance aims to shield its state-owned banks from potential secondary sanctions imposed by the United States. This move contrasts with a notice issued by China’s Ministry of Commerce on May 2, which had instructed companies to disregard US sanctions.

Al Jazeera noted that it could not independently verify the Bloomberg report. The situation highlights a possible policy divergence within China’s financial and trade authorities regarding compliance with US sanctions.