The Republican-controlled House on Thursday voted to block oil from the country’s emergency stockpile to China.
The bill, one of the first introduced by the new GOP majority, would prohibit the Department of Energy from selling oil from the Strategic Petroleum Reserve to companies owned or influenced by the Chinese Communist Party. It passed easily, 331-97, with 113 Democrats joining unanimous Republicans in support.
Rep. Cathy McMorris Rodgers, R-Wash., the new head of the House Energy and Commerce Committee, said the bill would help end what President Joe Biden called “the misuse of our strategic reserves.”
Biden withdrew 180 million barrels from the strategic reserve last year to prevent a rise in gasoline prices amid OPEC production cuts and a ban on Russian oil imports following Moscow’s invasion of Ukraine. The months-long selloff brought the stockpile to its lowest level since the 1980s. The government said last month it would start filling reserves now that oil prices have fallen.
McMorris Rodgers accused Biden of using the reserve to “cover up failed policies” that he says have driven up energy prices and inflation.
“Removing strategic reserves for political purposes and selling them to China is a significant threat to our national security and our energy. This must stop,” said McMorris Rodgers.
The measure is the first in a series of GOP proposals aimed at “launching American energy production,” McMorris Rodgers said as Republicans seek to boost production of oil, natural gas and other fossil fuels.
“There is more to come. This is just the beginning,” he said.
Democrats, including former Energy and Commerce Chairman Frank Pallone of New Jersey, said Republicans are trying to fix problems of their own making. China is among many potential adversaries buying U.S. oil after the GOP-led Congress lifted export bans in 2015.
“If the Republicans are serious about solving this problem, they will bring a bill that bans all oil exports to China,” Pallone said, adding that sales from the strategic reserve accounted for about 2% of US oil sold to China last year.
“If we really want to address China’s use of American oil to build its reserves, let’s actually take a serious look at that, instead of skirting around the issue because the Republicans are afraid of Big Oil’s wrath,” Pallone said.
The current process allows the sale of crude oil from the strategic reserve to the highest bidder, including US subsidiaries of foreign oil companies, who can then export the crude oil overseas. Last year, millions of barrels of oil from US reserves were exported to China, including to the Chinese state oil company Sinopec.
The Energy Department said in a statement Thursday that Biden “made the appropriate emergency use” of the strategic reserve, also known as the SPR, to address supply disruptions and “provide relief to America’s families and refineries when they are most needed.”
The Treasury Department estimated that the release of oil from the emergency stockpile lowered the price at the pump by 40 cents per gallon. Gasoline prices, meanwhile, averaged $3.27 a gallon on Thursday, down from just $5 a gallon at their peak in June, according to the AAA auto club.
“By law, we must choose the highest bid to ensure the best return for taxpayers, and since 2017, the majority of oil sold from the reserve has been sold to American entities,” the Department of Energy said. Over the past five years, less than 3% of oil from strategic reserves has gone to China, officials said.
The House bill now goes to the Democrat-controlled Senate. Sen. John Barrasso, R-Wyo., has introduced a similar measure.
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