How would a trade war affect US LNG exports? So far, China is the only nation to put tariffs on US cargoes, and we doubt buyers in Europe will follow suit. Nevertheless, East Daley Analytics sees consequences from the Trump administration’s fight over trade policy.
Beijing in February placed a 15% tariff on US LNG imports during the initial volleys with the administration over trade. Last Friday (April 11), China slapped a retaliatory 125% tariff on all US goods after President Trump raised levies on Chinese products to 145% earlier in the week.
The 15% tariff reportedly has forced Chinese buyers to turn away numerous US LNG cargos since the policy went into effect. However, LNG exports to China were already low following Russia’s invasion of Ukraine in early 2022, which saw US cargos diverted from Asia to European allies.
The US in 2024 exported 213 Bcf of LNG to China, according to Energy Information Administration (EIA) data. While a 25% increase from 2023, exports were still ~47% below 2021 levels. As a result, the Chinese tariffs implemented in February have had limited impact on US liquefiers. However, China isn’t the only nation considering retaliatory tariffs in the wake of the Trump administration’s tariff threats.
Last Wednesday (April 9), Trump announced that the reciprocal tariffs he had previously imposed on most US trade partners would be postponed for 90 days, while keeping in place a 10% tariff on US imports. Some nations have expressed interest in negotiating with the White House, but the European Union has been weighing how to respond.
If European nations implemented across-the-board tariffs, it would have significant impacts on US LNG shipments. However, we see a tax on foreign energy as unlikely. As part of the ongoing Russia-Ukraine war, gas shipments from Russia through Ukraine have ended, forcing Europe to rely on LNG shipments to restock storage. From 2022 through 2024, US LNG exports to Europe averaged 2,613 Bcf per year, up 114% from the 1,218 Bcf received in 2021 (see figure from EIA data).
The EU’s increased reliance on US LNG would likely necessitate energy carveouts in any retaliatory tariffs. While this helps minimize the impact on liquefiers, deliveries to Europe only accounted for 53% of US exports in 2024. Depending how other nations react, the US LNG industry could see additional tariffs.
The real risk is to the long-term outlook. Liquefaction projects are expensive, and uncertainty over costs will stall negotiations between developers and potential LNG buyers. Contractors may also want to revisit prior estimates to build facilities, creating further delays for emerging projects.
See EDA’s Macro Supply & Demand Report for more detail. In an optimistic scenario, the Trump administration will use its leverage to promote LNG exports and secure agreements for new projects. But otherwise, we anticipate commercial delays that will slow growth post-2030. – Ian Heming.
Did You Miss East Daley’s NGL Webinar?
East Daley on Wednesday (April 16) hosted a webinar reviewing the NGL market outlook. In Fueling the NGL Surge: Growth Across Key Basins, Infrastructure, and Midstream Advantage, we covered basin growth and key producers, infrastructure and midstream players, and explored the growing linkage between commodity markets. If you missed it, please sign up to review the webinar.
Data Center Demand Monitor - Available Now!
Introducing Data Center Demand Monitor by East Daley Analytics. This is your go-to source for tracking data center projects and demand. We monitor and visualize nearly 300 US data center projects. Use Data Center Demand Monitor to forecast demand, identify pipeline corridors and track data center projects. — Request your demo now of the Data Center Demand Monitor!
Get the FERC Intrastate Pipeline Data
Introducing East Daley’s latest data file: FERC 549D Intrastate Contract Data. This new offering delivers contract shipper data for intrastate pipelines — scrubbed and ready to use. Use the 549 data to identify which intrastate pipelines have available capacity, understand pipeline rate structures, gain insights into shippers, and spot contract cliffs and opportunities for higher rate renewals. Reach out to East Daley to learn more.
The Daley Note
Subscribe to The Daley Note (TDN) for midstream insights delivered daily to your inbox. The Daley Note covers news, commodity prices, security prices and EDA research likely to affect markets in the short term.