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US LNG exports to China in decline due to trade dispute

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LNG Industry,

Reuters is reporting that US LNG exports to China in July fell to their lowest level in the last 12 months, as utilities have begun to seek alternative sources. Exports are expected to decline further as the trade dispute between the two nations continues.

Shipping figures for US LNG exports to China are showing a drop to just 400 000 t in May, and an additional significant slump to a mere 130 000 t in July. Meanwhile, data shows LNG exports to China from Australia, Malaysia, Indonesia, Russia, and Papua New Guinea have all increased.

In a recent escalation, China announced that it is considering the introduction of a 25% import tariff on US LNG supplies in retaliation to the several duties placed on Chinese goods introduced by President Donald Trump since June.

Commenting on this proposed tariff, Bernstein energy research group commented, “The import tax will make US exports of LNG uncompetitive.”

Sources indicate that Chinese buyers are already seeking alternative sources in anticipation of a furthering worsening of conditions.

“The Chinese are already indicating that they would prefer not to take US cargoes for any new spot deals,” said a Singapore-based energy trader.

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