U.S. and China Discuss Cutting Tariffs on American LNG as Negotiations Accelerate Ahead of Xi's Visit
nashnova research
Washington and Beijing are negotiating to cut or eliminate China's 15% tariff on U.S. LNG, part of a broader framework where each side would reduce tariffs on roughly $30 billion in goods — a deal that could be announced during Xi Jinping's visit next week.
What exactly is on the table?
Two sources told Reuters that LNG tariff relief is part of a larger package — both sides would each cut tariffs on about $30 billion worth of goods.
Talks are not finalized. The White House and the Chinese embassy have not commented.
This means → LNG is not a standalone issue. It has been bundled into a package deal designed to pave the way for the Trump–Xi meeting on September 24.
What did the 15% tariff actually do?
China imposed a 15% tariff on U.S. LNG in February 2025, retaliating against Trump-era tariffs on Chinese goods.
The effect was immediate: U.S. LNG shipments to China dropped from 64 cargoes in 2024 to near zero in 2025 — trade essentially froze.
In plain terms = a single 15% tariff hit the pause button on LNG trade between the world's largest exporter and largest importer.
Why does the U.S. LNG industry need Chinese buyers back?
U.S. LNG is in a massive expansion phase. Export capacity is set to grow by roughly 10 billion cubic feet per day by 2027, with projects from Cheniere Energy, Venture Global, Sempra, NextDecade, and ExxonMobil.
The key number: about 24.5 million metric tons of capacity under construction has no long-term purchase contracts. This means → the plants are being built, but the buyers are not yet locked in — a real market gap.
Shipping data already shows several LNG tankers from the U.S. Gulf Coast arriving in or heading toward China — some buyers are testing the waters even while tariffs remain in place.
Can this deal come together, and why does it matter?
China is the world's largest LNG importer; the U.S. is the world's largest LNG exporter. Both sides have a strong economic incentive to resume trade.
If an agreement lands during Xi's visit, it would mark a shift from a de facto freeze to a systematic restart of U.S.–China energy trade.
This reflects a deeper signal: energy trade is becoming a ballast issue in U.S.–China relations — getting this right is the foundation for broader tariff negotiations down the line.
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