A US trade panel gave its unanimous approval on Friday to a government anti-dumping probe that could lead to steep US duties on an estimated US$2.6 billion worth of Chinese steel pipe used in oil production.

The US International Trade Commission voted 6-0 in favor of the investigation on the basis that there was a reasonable indication that the US industry is threatened with material injury by the Chinese imports.

The case is one of several prickly trade issues between the United States and China. Tensions have been exacerbated by the growth in the US trade deficit.

The vote means the Commerce Department can continue an investigation that could pave the way for anti-dumping and countervailing duties on the steel pipe imports.

It is slated to make a preliminary ruling on countervailing duties in early July, and anti-dumping duties in September. Final decisions by the department and ITC won't come until early next year.

United States Steel Corp , Tenaris SA unit Maverick Tube Corp and other US producers of "certain oil country tubular goods" filed the case after imports of the product from China jumped to US$2.6 billion in 2008 from US$749 million in 2007.

Steel prices have slumped as the recession dried up demand, and most steelmakers have cut production sharply.

(Xinhua News Agency May 23, 2009)