JAKARTA – Chinese state-backed energy companies and private gas distributors may need to renegotiate long-term liquefied natural gas (LNG) procurement contracts with US suppliers if the trade war continues.

Li Lunjia, lead research analyst at S&P Global Commodity Insights, stated on Tuesday (April 22) that US LNG shipments to China halted on April 10, 2025, after Beijing imposed a 15% tariff on US LNG in response to the 10% US tariffs on Chinese goods. On Saturday (April 12), the tariff on US LNG was increased to at least 140%.

“During the first US-China trade war in 2018–2019, US LNG imports were suspended for 18 months,” Li said in a webinar. “Similar to that period, we can expect a suspension of US LNG imports and contract activities as long as the current tariffs remain in place.”

However, Li pointed out that Chinese buyers now hold significantly more long-term US LNG contracts than during the previous trade conflict, when nearly all LNG purchases were short-term contracts traded in the spot market.

Although the US has supplied only 4.4% of China’s total LNG imports over the past three years, with just 3.8% of US LNG exports going to China, the volume was projected to grow rapidly in the coming years.

Currently, Chinese buyers hold 21 long-term procurement contracts with US LNG producers, covering an annual volume of 25.6 million tons. In the short term, most of the 5.7 million tons of LNG expected to be delivered to Chinese customers this year could easily be resold to buyers in other markets. (DK/LM)