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US may impose restrictions on oil exports to China

US may impose restrictions on oil exports to China Illustrative photo (photo: Getty Images)

Leaders in the US Congress have announced a new measure in financial legislation that prohibits China from buying oil from the Strategic Petroleum Reserve, according to Reuters.

In Congress, this idea is supported by both Democrats and Republicans. Lawmakers have introduced dozens of bills aimed at countering competition from China.

The issue of SPR sales to China heated up after President Joe Biden, a Democrat, announced in 2022 a sale of 180 million barrels of SPR oil to tame gasoline prices that spiked after Russia invaded Ukraine.

That year the SPR sold 1 million barrels to UNIPEC America, a Houston-based arm of China's Sinopec. In 2017, under former President Donald Trump, some SPR oil was sold to PetroChina International, a subsidiary of Chinese state oil company PetroChina Co Ltd.

The SPR currently holds more than 360 million barrels of oil but is close to 40-year lows due to the sales in 2022.

US oil companies sold 83 million barrels of oil to China in 2022.

The US House will have to vote on the bill first before the Senate can take up the package before Friday, Senate Majority Leader Chuck Schumer said. The House is due to return to Washington on Tuesday.