US Slaps Sanctions on Global Network Fueling Iran’s Drone Rebuilding Effort After June War

The U.S. Treasury Department sanctioned 32 individuals and entities across eight countries on Wednesday for operating procurement networks that supply Iran’s ballistic missile and drone production programs, marking the latest attempt to prevent Tehran from reconstituting military capabilities destroyed during the 12-Day War in June 2025.

The sanctions target a sophisticated web of front companies and facilitators in Iran, the United Arab Emirates, Turkey, China, Hong Kong, India, Germany, and Ukraine that have channeled hundreds of metric tons of missile propellant ingredients and critical UAV components to Iran’s defense industry. The Treasury Department warned these networks “pose a threat to U.S. and allied personnel in the Middle East and to commercial shipping in the Red Sea.”

Iran Scrambles to Rebuild Drone Production After Devastating June Losses

The timing of these sanctions reflects Iran’s urgent campaign to restore drone and missile manufacturing infrastructure that Israeli and U.S. forces heavily damaged during June’s military confrontation. The 12-day conflict saw coordinated strikes against Iran’s nuclear facilities, military installations, and weapons production sites, significantly degrading Tehran’s advanced capabilities.

According to the Treasury Department’s announcement, the sanctioned networks have been critical to Iran’s reconstitution efforts.

“As Iran seeks to reconstitute its proliferation-sensitive capabilities destroyed during following the 12-Day War, OFAC is acting to disrupt the procurement of key components, such as missile propellant precursors,” the department stated.

Under Secretary of the Treasury for Terrorism and Financial Intelligence John K. Hurley emphasized the global nature of Iran’s procurement operations:

“Across the globe, Iran exploits financial systems to launder funds, procure components for its nuclear and conventional weapons programs, and support its terrorist proxies.”

The MVM Partnership: Missile Propellant Procurement Network

At the center of Wednesday’s sanctions sits the “MVM Partnership,” a multinational operation run by UAE-based German national Marco Klinge and two Iran-based Iranian nationals, Majid Dolatkhah and Vahid Qayumi. Since 2023, this network has coordinated the procurement and transport of hundreds of metric tons of critical missile propellant ingredients from China.

The Treasury identified three key chemicals flowing through this network: sodium chlorate, sodium perchlorate, and sebacic acid. These materials are delivered to Parchin Chemical Industries (PCI), a subsidiary of Iran’s Defense Industries Organization already sanctioned under Executive Order 13382 for weapons proliferation.

The network operated through front companies strategically positioned in the UAE, India, and Germany to obscure the true destination and purpose of these shipments. This sophisticated structure allowed Iran to evade existing sanctions while rebuilding capabilities specifically targeting ballistic missile production.

UAV Manufacturing Networks Target Shahed Drone Reconstruction

The sanctions also dismantle procurement channels supporting Iran’s unmanned aerial vehicle programs, particularly efforts to restore production of the Shahed-series drones that have become central to both Russia’s war in Ukraine and Iran’s regional military strategy.

Treasury designated Kimia Part Sivan Company (KIPAS) and its subsidiary networks for manufacturing and repairing UAV components in coordination with Iran’s Islamic Revolutionary Guard Corps-Quds Force (IRGC-QF). Two KIPAS front companies—Iranian Baspar Puya Company (PARPO) and Pars Navandishan Artificial Intelligence Projects Company (ARIAPA)—received sanctions for producing drone electronics and guidance systems.

The action specifically targets four KIPAS personnel who managed UAV component production and logistics operations. Between mid-2024 and early 2025, these individuals oversaw production of hundreds of UAV components and coordinated acquisition of critical drone engines.

China-based facilitator Ma Jie also received sanctions for coordinating meetings between Iranian defense officials and Chinese suppliers while managing several front companies that processed transactions for Oje Parvas Mado Nafar Company (Mado), the producer of Shahed-131 and Shahed-136 engines.

Maximum Pressure Campaign Targets Iran’s Rebuilt Arsenal

This action represents the second round of nonproliferation sanctions since the reimposition of UN sanctions on Iran on September 27, 2025, which occurred following Tehran’s continued non-compliance with international commitments. The sanctions operate under President Trump’s National Security Presidential Memorandum 2, directing a campaign of “maximum pressure” on Iran.

“At the direction of President Trump, we are putting maximum pressure on Iran to end its nuclear threat,” Hurley stated. “The United States also expects the international community to fully implement UN snapback sanctions on Iran to cut off its access to the global financial system.”

The Treasury also updated sanctions against the bulk carrier vessel HONESTAR (formerly SHUN KAI XING), identified for transporting computer-controlled manufacturing equipment to Iran’s defense industry while using false flags and stateless registration to disguise its operations.

All property and assets of designated individuals and entities under U.S. jurisdiction are now frozen, and U.S. persons are prohibited from conducting transactions with them. Foreign financial institutions facilitating significant transactions for sanctioned parties could face secondary sanctions, including restrictions on U.S. banking access.

DroneXL’s Take

These sanctions land at a critical inflection point in Iran’s drone program trajectory. Five months after the June war exposed serious vulnerabilities in Iran’s vaunted missile and drone arsenal, Tehran is racing against the clock to rebuild production capabilities while Western powers work equally hard to strangle those efforts at the supply chain level.

The contrast between Iran’s drone performance in different theaters tells the whole story. As we’ve extensively documented, Iran’s Shahed-136 drones have been devastatingly effective in Ukraine, with Russia launching over 38,000 Shaheds in 2025 alone. The low-cost, mass-produced design fundamentally changed modern warfare by overwhelming air defenses at a fraction of traditional missile costs.

But when those same drones faced Israeli and U.S. air defense systems during the June conflict, the results were starkly different. Iran managed to launch only around 500 ballistic missiles and 1,100 drones over 12 days—and the vast majority were intercepted. The war exposed that while Shahed drones excel against less sophisticated defenses, they struggle against layered, advanced air defense networks backed by real-time intelligence.

That’s precisely why today’s sanctions matter. Iran isn’t just trying to rebuild its drone production—it’s trying to do so while the global arms race to copy the Shahed design accelerates. The U.S., China, France, and the UK are all developing their own versions of the triangular-winged UAV. The Pentagon’s LUCAS drone represents America’s direct response to the Iranian design that proved so effective in Ukraine.

The procurement networks targeted today—spanning China, the UAE, Turkey, and beyond—represent Iran’s lifeline for obtaining the components it can’t manufacture domestically. Servo motors for the Mohajer-6. Electronics for guidance systems. Propellant chemicals for ballistic missiles. These aren’t glamorous headlines, but they’re the unglamorous reality of modern military production.

What makes this particularly interesting is the Ukraine connection. Many of these same procurement networks don’t just supply Iran—they facilitate the flow of Shahed components to Russia for use against Ukrainian cities and infrastructure. By targeting Iranian procurement, Treasury is simultaneously disrupting Russia’s drone supply chain. We’ve previously covered how companies like Sahara Thunder oversee commercial activities supporting both the IRGC and Russia’s war effort.

The broader question is whether sanctions can actually work at this stage. Iran has decades of experience evading international restrictions, and as we saw with EU sanctions earlier this year, Tehran dismissed Western actions as based on “repeated, absurd, and baseless excuses and accusations.”

Iran’s shadow banking networks, front companies, and transactional relationships with authoritarian states create multiple pathways around restrictions. But each network dismantled, each facilitator exposed, forces Iran to rebuild connections and find new routes—buying time and raising costs.

The real test will come when Iran inevitably attempts another major military action. Reports suggest Tehran is working around the clock to build stockpiles capable of firing 2,000 missiles at once rather than 500 over 12 days. Whether these sanctions successfully degrade that rebuilding effort won’t be clear until the next confrontation.

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