China has stopped buying liquefied natural gas (LNG) from the United States for more than ten weeks. The reason is a sharp increase in tariffs — extra taxes — on American gas. These new taxes have made it too expensive for Chinese companies to buy LNG from the US.

According to data from the Financial Times, the last LNG shipment from the US to China arrived on February 6 in Fujian province. After that, another gas shipment heading to China had to be sent to Bangladesh instead. It couldn’t reach China before the 15% tariff kicked in on February 10. Since then, China has raised the duty to 49%, making American LNG too costly for Chinese importers.

Energy expert Anne-Sophie Corbeau from Columbia University’s Centre on Global Energy Policy said, “There will be long-term consequences. I do not think Chinese LNG importers will ever contract any new US LNG.”

This situation is similar to what happened during Donald Trump’s presidency when China also stopped buying American gas for over a year. Analysts say that the new trade freeze could hurt the development of big LNG projects in the US and Mexico. These projects often depend on money and contracts from Chinese companies.

China turns to Russia for more energy

Power of Siberia 2 pipeline in discussion, Russia now a top gas supplier

As the US-China LNG trade comes to a halt, China is turning to Russia for more energy. China’s ambassador to Russia, Zhang Hanhui, said, “I know for sure that there are a lot of buyers. So many buyers are asking the embassy to help establish contacts with Russian suppliers.”

Russia is now China’s third-largest supplier of LNG, after Australia and Qatar. Talks are also going on for the Power of Siberia 2 pipeline, which would send even more gas from Russia to China and make their energy partnership stronger.

After the Russia-Ukraine war began, Chinese companies started reselling US gas to Europe, where prices were higher. In 2024, only 6% of China’s LNG imports came from the US. That’s a big drop from 11% in 2021.

Experts believe this freeze in trade will last. Gillian Boccara from Kpler said, “The last time this happened, there was a complete hiatus until the Chinese authorities granted waivers to companies, but that was at a time when gas demand was booming. Now we are looking at lower economic growth, and we think the Chinese can withstand the loss of these cargoes for quite a long time.”

Richard Bronze from Energy Aspects added, “With tariffs rising to the level where they are an effective embargo, we will see a reshuffling of trade flows. We also expect Asia's demand to fall by 5–10 million tonnes as a whole. That should bring gas prices down a bit in Europe.”

 

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