Banning US oil reserves to China presents a rare bipartisan opportunity for a divided Congress

Lawmakers have a chance of an early bipartisan victory as Congress debates legislation to prevent future releases of the nation’s emergency oil reserves from falling into the hands of Chinese companies.

Legislation to ban such sales of oil from the Strategic Petroleum Reserve (SPR) to a foreign adversary sailed through the GOP-led House last week with broad bipartisan support, including 113 House Democrats. The proposal is driven by national security concerns that appeal to both sides.

Senate Democrats say they are open to the idea as they weigh possible changes to the measure, which comes in the wake of some releases of stocks that were sent to companies in China last year as part of a 180 million-barrel sale for part of President Biden to mitigate high prices at the pump in the US.

SPR sales are required to be awarded to the highest bidder under current federal law, which means the US commodity can be sold directly to Chinese companies or indirectly to domestic or international companies that then export it to Beijing.

“I certainly wouldn’t want sales of that to benefit China,” said Sen. Michael Bennet, D-Col.

Senate Majority Whip Dick Durbin, D-Ill., did not rule out the Republican-led initiative.

SEE ALSO: House GOP and White House spar over oil reserves as Republicans seek to curb the president’s power

“I want to take a close look and see the impact of the president’s depletion of the Strategic Petroleum Reserve in an effort to reduce gasoline prices… before making a judgment about how to allocate that reserve,” he said.

Senate Energy Committee Chairman Joe Manchin III is also weighing the legislation and said a broader assessment of the SPR is needed as Republicans lament Biden’s draining of reserves to their lowest levels since 1983.

“We are seeing that. I feel the same. It’s time we stopped withdrawing from the SPR. We have to make some kind of effort to start filling that endorsement and make sure we do it as quickly as possible,” said the conservative Democrat from West Virginia. “With China, the way it sells on the open market right now, they bid, whoever makes the highest bid gets it. unless we want [change it so] that they shouldn’t be able to access this at all.”

At least 1 million barrels of SPR last year went to China via Unipec America, an arm of Chinese oil and gas firm Sinopec, the Energy Department said. Reuters reported that five million barrels at another time went to China and other countries, though it was unclear how much went to China.

The amounts may pale in comparison to the more than 250 million barrels the nonpartisan Congressional Research Service says Biden has released since October 2021. But lawmakers argue that allowing a foreign adversary to receive any of the emergency supplies of the nation is bad national security policy. .

Outside of SPR, private US energy companies export an average of about 3 million barrels of oil per day to China, according to the US Energy Information Administration (EIA).

“The United States Strategic Petroleum Reserve is intended for true power supply disruptions such as those caused by hurricanes and natural disasters, not to help China,” the chair of the Committee on Trade and Energy said during the debate on its approval. of the House of Representatives, Cathy McMorris Rodgers, a Washington Republican who spearheaded the legislation. . “Draining our strategic reserves for political purposes and selling parts to China is a significant threat to our national security.”

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