China was providing aid to the Nationalist Chinese, aid that was going through Indochina. And the oil was still being sold because it was in compliance with trade agreements already in place, shortly after those agreements expired the embargo commenced.
The US could have abrogated those trade agreements, no? Why didn't it?
Indeed, as late as July 24, 1941, Roosevelt stated he would not issue an embargo order because that would force Japan to attack the East Indies, and proposed that if Japan withdrew from Indochina, the US would push for the neutralization of Southeast Asia. Similarly, Roosevelt didn't work out a policy of sanctions until after the move into Indochina.
(Amusingly the embargo order was not interpreted this way, but it remains that it's not a sign of full-fledged support for China).
The embargo has to be squared with America's concern about Southeast Asia's resources and supply routes, which it saw as vital to the British War Effort. This squares with the dates of the embargos and sanctions of Japan, which followed expansion in Indochina, not southeast Asia.