House Votes to Sanction China’s Purchase of Iranian Oil

House Votes to Sanction China’s Purchase of Iranian Oil

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(Bloomberg) — The US House of Representatives overwhelmingly passed legislation Monday aimed at countering China’s purchase of Iranian crude oil as part of a package of bills being brought to the floor in response to Iran’s attack on Israel. 

The legislation was approved by a 383-11 vote, surpassing the requisite number needed to overcome a presidential veto. The legislation moves to the Senate where it faces an uncertain fate. 

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The bill, H.R. 5923, Iran-China Energy Sanctions Act of 2023, expands secondary sanctions against Iran to cover all transactions between Chinese financial institutions and sanctioned Iranian banks used to purchase of petroleum and petroleum products, according to a summary of the bill. The legislation also requires the US to make a determination annually whether Chinese financial institutions have engaged in sanctionable conduct. 

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About 80% of Iran’s roughly 1.5 million barrels a day of oil exports are sent to independent refineries in China known as “teapots,” according to the summary. The bill, introduced by New York Republican Representative Mike Lawler, clarifies that any transaction by a Chinese financial institution for the purchase of oil from Iran qualifies as a “significant financial transaction” for sanctions purposes.

Read More: BGOV Bill Summary: H.R. 5923, China-Iran Oil Purchases

The measure, unanimously approved by the House Financial Services Committee in November, is one of several Iran-related bills that were slated to be considered Monday under an expedited procedure typically used to pass legislation that has bipartisan support. 

The sanctions, if passed into law and enforced, could result in an increase of as much as 20 cent per gallon on gasoline prices, consulting firm ClearView Energy Partners said in a note to clients Monday.

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(Adds vote total in second paragraph, analysis in final graph.)

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