China Cuts Off U.S. LNG Imports, Shifting Global Gas Dynamics

China has stopped importing liquefied natural gas (LNG) from the United States, a move confirmed by recent shipping data and Chinese customs figures. This halt began after Beijing imposed a 15% tariff on US LNG shipments in February and later raised the tariff to 49%.

The last US LNG cargo arrived in China’s Fujian province on February 6, with a second ship diverted to Bangladesh after failing to beat the new tariff deadline. No further US LNG shipments have reached China since then.

This step marks a sharp escalation in the ongoing US-China trade war, expanding its impact into the energy sector. The tariffs have made US LNG financially unviable for Chinese buyers, effectively cutting off the trade.

US gas accounted for just 6% of China’s LNG imports last year, down from 11% in 2021. Now, that share could drop to zero. Chinese energy majors, including PetroChina and Sinopec, hold 13 long-term contracts to buy US LNG, some running until 2049.

However, these firms have shifted strategy. Instead of bringing US LNG into China, they have resold most of these shipments to Europe, where prices are higher and tariffs do not apply.

The Shifting Landscape of Global LNG Trade

In 2024, Chinese buyers already resold about 70% of their US LNG cargoes to European markets. The freeze mirrors a similar halt during Donald Trump’s first term, but this time, the effects could last longer.

Analysts see little chance of Chinese importers signing new US LNG contracts. Developers in the US and Mexico now face uncertainty over the future of their multi-billion-dollar LNG projects, as the Chinese market becomes unreliable.

Meanwhile, China has increased its LNG imports from Russia, which supplied four times more LNG to China last year than the US did. Russia now ranks as China’s third-largest LNG supplier, behind Australia and Qatar.

The two countries are also negotiating the Power of Siberia 2 pipeline, which could further cement their energy ties. The US LNG industry, while losing ground in China, has found new buyers in Europe, where demand has surged since the Russian invasion of Ukraine.

However, the loss of the Chinese market raises questions about the sustainability of US export growth, especially as Chinese demand slows and global trade patterns shift.

The latest tariffs have triggered a realignment in global gas flows. China’s pivot to Russian gas and Europe’s embrace of US LNG reflect a new era in energy trade, driven by tariffs, geopolitics, and shifting demand.

This development underscores how energy markets now serve as both economic tools and strategic levers in the broader US-China rivalry.