The U.S. Navy’s blockade of Iran’s southern coast is working. Maritime Executive, a shipping media platform, assessed on September 28, 2026, that the blockade “appears to be nearly 100 percent effective,” cutting the flow through Bandar Abbas and other southern ports that handled 80 percent of Iran’s trade before the war. Tehran has responded by looking north. Caspian Sea cargo volumes rose 50 percent between March and August 2026, according to the Caspian littoral Gilan province governor.
Shortly after Russia’s war in Ukraine bogged down, Iran shipped more than 300,000 artillery shells and a million rounds of ammunition to Russia across the Caspian.
The route is no secret. Shortly after Russia’s war in Ukraine bogged down, Iran shipped more than 300,000 artillery shells and a million rounds of ammunition to Russia across the Caspian. Israel struck Iran’s Bandar Anzali Caspian Sea naval base on March 18, 2026. U.S. officials subsequently acknowledged that Russia was sending drone components to Iran by the same route to replenish Iran’s drone arsenal. On September 10, 2026, Ukrainian drones struck the port of Makhachkala, which Ukraine’s General Staff said plays a vital role as “the Russia-Iran logistics corridor across the Caspian Sea, which is used to circumvent Western sanctions.”
Yet, despite the growing importance of the Caspian route, U.S. sanctions lag.
In November 2024, the head of the Russian office of Khazar Sea Shipping Lines, the Caspian arm of Iran’s state carrier, Islamic Republic of Iran Shipping Lines, and a target of U.S. sanctions since 2018, said the company had bought two dry cargo ships in St. Petersburg, had a third under construction at the Lotos yard in Astrakhan, and was considering another tanker and a container ship. On February 16, 2026, Lotos handed over the 7,200-ton Sahel-e Khazar, with Iran’s ambassador to Moscow in attendance, and Islamic Republic of Iran Shipping Lines’s chief executive said the line’s Caspian capacity would reach 150,000 tons by the end of 2026.
Article 3 of the 2018 Aktau convention bars armed forces of non-coastal states from the Caspian. Iran appears to be the only littoral state that has not ratified it, though President Masoud Pezeshkian sent it to parliament in August 2026. The only force interdicting the sea is Ukraine, with long-range drones. On July 25, 2026, it hit two sanctioned cargo ships, Port Olya 2 and Begey, a Russian corvette, and an Iranian cargo vessel. Tehran called it a “hostile and criminal” attack, but it never published a manifest. While the U.S. Department of the Treasury sanctioned the Port Olya 2 in April 2023 for facilitating military trade between Iran and Russia, it did not do so with the Begey, even though the United Kingdom and Canada had.
The Lindsey O. Graham Sanctioning Russia and Iran Act, which President Donald Trump signed on September 18, 2026, gives Washington great reach over trade. Summaries stress oil, but its text covers any foreign vessel the president determines Russia or Russians use to move oil, gas, coal, uranium, “arms, or other goods for the purpose of circumventing sanctions imposed by the United States or other countries.” That last phrase matters: A ship dodging British or Canadian sanctions can qualify even if Washington never listed it. The act also covers anyone who knowingly owns, operates, manages or insures such a vessel, and the operators of foreign ports that service ships the United States has sanctioned for supporting Russia. Port Olya 2 is one. The president has until October 18, 2026, to act.
When strikes hit contested cargo ships, quickly releasing the targeted ships’ manifest flips Tehran’s propaganda on its head.
The U.S. government should designate not only oil tankers, but also the hulls that carry arms across the Caspian, their managers and insurers, and the ports that receive them. To minimize sanctions divergence from its allies, the U.S. Department of the Treasury should ensure that any ship sanctioned by Canada, the European Union, Ukraine, or the United Kingdom, at a minimum, triggers a review to align lists.
With no naval option because the Caspian Sea is landlocked, the U.S. government should monitor ports such as Amirabad, Anzali, Noshahr, Astrakhan, Olya and Makhachkala, and share the findings with Israel and Ukraine.
While it is not explicitly covered by the act, the Treasury Department should test whether yards delivering hulls to a sanctioned Iranian carrier fall under existing sanctioning authorities. If Treasury lawyers can make the argument, then they should sanction shipping yards.
Finally, while intelligence agencies resist public release on information in order to protect sources and methods, when strikes hit contested cargo ships, quickly releasing the targeted ships’ manifest flips Tehran’s propaganda on its head. Treasury should extend its VTB Bank action, which targeted the Russia-Iran ruble-rial channel, to banks in Russia and third jurisdictions that settle Caspian freight or pay for Russian-built hulls for Iran’s carrier.
