Following the imposition of a 15% tariff on LNG imports starting February 10, China has ceased all purchases of liquefied natural gas from the United States, according to a report by The New York Times.
As reported by the media outlet, vessel tracking information suggests that Beijing is progressively detaching from the U.S. economic sphere. Statistics from China’s customs authority reveal that imports of liquefied natural gas from the United States by China were already at minimal levels during the period spanning November through January.
Meanwhile, China has boosted its buying from Russia, which supplied the nation with four times as much liquefied gas compared to the amount shipped by the U.S. last year.
Just two liquefied natural gas (LNG) carriers from the U.S. were heading to China when Beijing slapped tariffs on American fossil fuels in reaction to the first set of 10% duties on Chinese products implemented by then-U.S. President Donald Trump.
As stated by the Belgian energy firm Kpler, one ship reached China prior to the imposition of tariffs and discharged its shipment, whereas the second vessel was rerouted to Bangladesh to circumvent the levies.
The outlet notes that Europe’s boycott of Russian natural gas following its full-scale invasion of Ukraine in 2022 has resulted in Russian gas being sold at very low prices, while European companies are paying significantly more for gas from other countries, including the US.
Consequently, Chinese firms have been able to acquire substantial amounts of inexpensive natural gas from Russia rather than the US.
The New York Times recalls that US LNG exports to China surged after the signing of a trade agreement between Beijing and Washington in January 2020. That deal included a commitment by China to increase purchases of American gas, though not necessarily for domestic use.
In 2022, exports dropped sharply when American gas was rerouted to Europe due to higher pricing after Europeans decided against purchasing Russian gas.
As per China’s customs administration data, the U.S. made up only 3% of China’s natural gas imports for the previous year.
Trade war between the US and China
Initially, US President Donald Trump applied an extra tariff of 20% on imports from China, which he later escalated by adding an additional 34%. Every instance when China declared countermeasures, the U.S. president amplified the tariff rates further.
A few days later, Trump raised tariffs on Chinese goods to 145%, while simultaneously announcing a 90-day pause on tariffs for goods from other countries.
As a result, Beijing raised the tariffs on American products to 125%.
Recently, the White House mentioned that due to counteractions following US tariffs, China is now subject to import duties into the U.S. totaling up to 245%.
Subsequently, the Trump administration elucidated their earlier statement, specifying that merely particular products from China, including electric vehicles and syringes, fall under a 245% tariff. It does not represent an extensive new round of tariffs being applied broadly across all Chinese imports.
