US-China LNG Tariff Talks Could Speed Up Gulf Coast Export Buildout
The US and China are discussing rolling back or eliminating China’s 15% tariff on American LNG as part of a broader trade package ahead of Xi Jinping’s September 24 meeting with President Trump, according to a Reuters report via BOE Report.
Market Impact
The tariff relief would be part of a wider framework in which both countries cut duties on roughly $30 billion of goods each, according to people briefed on the talks cited by Reuters. China imposed the LNG tariff in February 2025 in retaliation for Trump’s duties on Chinese goods, a move that effectively halted the US-China LNG trade. US LNG shipments to China fell from 64 vessels in 2024 to effectively zero in 2025, a steep drop from the record 131 vessels shipped in 2021.
The timing matters for producers now building out capacity. US LNG export capacity is set to grow by about 10 billion cubic feet per day through 2027, with Cheniere Energy, Venture Global, Sempra, NextDecade and Exxon Mobil among the companies adding volume. Of the nearly 100 million metric tons of US LNG capacity under construction, 24.5 million metric tons remain uncontracted, according to industry estimates and Reuters analysis cited in the report. Some Chinese buyers appear to have already started returning even with the tariff in place: LSEG shipping data cited by Reuters shows several recent Gulf Coast cargoes arriving in or headed to China. US LNG exports averaged 17.4 bcf/d in the first half of 2026, up 23% year over year, per Energy Information Administration data referenced in the report.
What It Means for Subcontractors
- A confirmed tariff rollback would help uncontracted capacity (24.5 million metric tons) attract long-term buyers, which is often the trigger for final investment decisions on Gulf Coast liquefaction trains still seeking financing.
- Watch for announcements tied to the September 24 Trump-Xi meeting specifically. If a deal is reached that date, expect FID and EPC award news from Gulf Coast developers (Cheniere, Venture Global, Sempra, NextDecade, Exxon Mobil) to follow within weeks, opening subcontract packages for civil, mechanical, E&I and pipefitting crews.
- This is still a discussion, not a signed agreement. The two people briefed on talks told Reuters the framework “is not final,” so subcontractors should treat this as an early signal for pipeline and workforce planning, not a basis for firm bid commitments yet.
- Firms with existing relationships on Gulf Coast liquefaction projects should track FEED and contracting updates from the named developers closely; renewed Chinese offtake demand could accelerate schedules on projects currently stalled awaiting long-term customers.
