US, China discuss cutting tariffs on LNG ahead of Xi visit

by@Reuters

Summary

The US and China are currently in discussions to reduce or eliminate China's 15% tariffs on American liquefied natural gas (LNG) as part of a broader effort to enhance bilateral trade. This potential tariff reduction could be announced during Chinese President Xi Jinping's upcoming visit to Washington on September 24, aimed at stabilizing trade relations. The talks also encompass reciprocal tariff cuts on about $30 billion of goods, reflecting the economic incentives both nations have to restore a trading relationship that had previously seen significant growth before the tariff imposition. US LNG exports to China dramatically decreased from 64 vessels in 2024 to nearly zero in 2025 due to the tariffs, making the outcome of these discussions particularly impactful for American LNG producers seeking new markets.

Analysis

US: The United States is a major global economy and energy producer with significant LNG export capabilities. It is actively engaged in bilateral trade discussions with China focused on reducing tariffs on American liquefied natural gas exports. China: China is the world's largest importer of liquefied natural gas and a key trading partner in global energy markets. It is negotiating with the United States to lower tariffs on US LNG as part of broader efforts to ease trade tensions ahead of high-level meetings. Donald Trump: Donald Trump is the President of the United States, overseeing trade policy and diplomatic engagements with China. He is scheduled to meet with Chinese President Xi Jinping to discuss energy, agriculture, and tariff adjustments. Energy Trade: The US and China are discussing reciprocal tariff reductions on approximately $30 billion worth of goods, including LNG, to restore previously disrupted trade flows. Market Context: US LNG producers are pursuing new export destinations amid ongoing global shifts in energy supply and demand patterns. Diplomatic Engagement: The tariff discussions form part of preparations for a planned September 24 meeting between President Trump and Xi Jinping aimed at stabilizing bilateral relations.

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