China has halted U.S. LNG imports for 40 days, the longest pause in nearly two years due to tariffs stemming from trade tensions. This suspension has led to a redirection of shipments to Europe and increased purchases from Australian suppliers. Moreover, China’s energy strategy now emphasizes domestic production and alternative sources, further complicating U.S. exporters’ prospects in the Chinese market.

China has recently suspended imports of liquefied natural gas (LNG) from the United States for a period of 40 days, marking the most significant break in transactions in almost two years. This interruption, arising from ongoing trade tensions, necessitates that traders adjust their shipping routes to evade tariffs imposed by Beijing, thus having a notable impact on the global LNG market, as reported by Bloomberg.

The current halt in U.S. LNG imports to China is the longest since June 2023 according to ship tracking data from Bloomberg. Furthermore, Kpler, an analytics service, has confirmed that there are currently no U.S. LNG shipments heading towards China. This situation emphasizes the persistent trade conflict initiated by the Trump administration, which threatens to separate the leading global LNG supplier from its largest buyer.

In response to the tariffs on Chinese exports imposed by the United States, China retaliated with a 15% tariff on U.S. LNG shipments starting February 10. As a result, Chinese companies with long-term contracts for U.S. projects are redirecting their purchases towards European markets, as stated by various traders. Additionally, Chinese importers are reluctant to ink new agreements with American facilities, preferring instead suppliers from the Asia-Pacific or Middle East regions.

Recently, China Resources Gas International has finalized a long-term agreement to acquire LNG from Australia’s Woodside Energy Group for a duration of 15 years set to begin in 2027. This signifies the first term-supply arrangement between Chinese and Australian firms in several years, a result of improving trade ties between Beijing and Canberra.

To bolster its energy security, China is also augmenting its domestic gas production, which has shown steady growth, including a year-on-year increase of 3.7% in the initial two months of 2025. Additionally, the decrease in demand for imported gas is influenced by cheaper energy options such as coal, renewable resources, and Russian gas.

The previous trade war during the Trump administration resulted in a halt to U.S. LNG sales to China. However, following the resumption in 2020, Chinese imports from the U.S. consistently exceeded 400,000 tons monthly. Moreover, U.S. Secretary of State Marco Rubio in January proposed leveraging LNG in trade discussions, but China’s present approach presents significant challenges for U.S. developers attempting to secure contracts for new projects.

Currently, China’s LNG imports are reported to have decreased to their lowest level since the onset of the COVID-19 pandemic, reflecting reduced demand and high prices in Europe, leading to a diversion of shipments away from China.

In summary, China’s 40-day suspension of U.S. LNG imports marks a significant shift in the energy trade landscape, driven by escalating trade tensions and tariffs. With Chinese buyers unwilling to engage with U.S. suppliers, they are increasingly looking towards alternative sources, particularly from Australia and other regions. This development not only underscores the complexities of U.S.-China trade relations but also highlights the evolving dynamics of energy security and supply strategies within China.

Original Source: www.offshore-technology.com

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