The European Union has imposed sanctions on a Syrian businessman who it says bought oil for the Syrian government from Islamic State militants who have seized wide areas of the country including its oil-producing regions.
The businessman, George Haswani, denied the accusation. He told Reuters by phone that the European Union had no evidence to back up the claim and should instead look for intermediaries he said were smuggling oil to Turkey on Islamic State's behalf.
Islamic State has seized much of eastern and northern Syria, including areas at the borders with Iraq and Turkey, declaring the territories part of its "caliphate".
Adding to its list of sanctions on supporters of Syrian President Bashar al-Assad, the EU said Haswani worked as an intermediary to agree oil contracts between Syria and Islamic State.
"George Haswani provides support (for) and benefits from the regime through his role as a middleman in deals for the purchase of oil from ISIL (Islamic State) by the Syrian regime," the EU said in its official journal without detailing how it reached its conclusion.
"He has close ties to the Syrian regime," the EU said, adding that Haswani also goes by the names Al Hasawani and Heswani.
Haswani's HESCO Engineering & Construction Co is a major business in Syria, the EU said. Haswani said his company builds oil and gas installations, and had worked in Algeria, the United Arab Emirates and Sudan.
Haswani told Reuters his company was currently building a gas installation in an area of central Syria that falls under Islamic State influence, adding "this is maybe how these fantasies were constructed".
Western officials have often accused the government of buying oil from Islamic State, but the EU announcement contains some of the most detailed public accusations to date and was welcomed by Britain's Foreign Minister Philip Hammond.
"This listing gives yet another indication that Assad's 'war' on ISIL is a sham and that he supports them financially," Hammond said in a statement.
Haswani said he would sue the European Union.
Damascus accuses the Turkish government, which is hostile to Assad, of supporting Islamic State in different ways, including by allowing it to smuggle contraband out of northern Syria. Turkey denies the accusations.
A February report by the Paris-based Financial Action Task Force said that Islamic State had generated large amounts of money by appropriating oil fields and from criminal activity such as theft and extortion.
The United Nations Security Council, meanwhile, has threatened sanctions against anyone buying oil from Islamic State.
In November the U.N. estimated the group's revenue from oil ranged between $846,000 and $1.6 million a day.
Degrading the group's financial resources is one aspect of a campaign led by the United States to destroy Islamic State, ranging from military attacks to counter-propaganda.
Though the Syrian government has been launching its own air strikes against Islamic State, Washington has rejected the idea of partnering with Damascus in the fight against Islamic State. It describes Assad as part of the problem.
The EU's sanctions were extended to a total of 13 people and organizations, including Haswani, adding to a previous list of more than 200 individuals and 60 entities.
Those on the list have their assets in the EU frozen and are barred from entry to the bloc.
Some EU states have pressed for more dialogue with Assad, who has survived four years of armed revolt and now faces an enemy, in the form of Islamic State, whom Western powers also want to defeat.
But the bloc's main military powers, France and Britain, oppose restoring relations with Damascus.
