Key Points
- Washington is pursuing Beijing to lower Chinese tariffs on American liquefied natural gas.
- The proposal is part of a package covering energy, agriculture and trade.
- President Donald Trump and President Xi Jinping are due to meet in Washington on September 24.
WASHINGTON: The US and China are discussing a possible reduction or removal of Chinese tariffs on American liquefied natural gas ahead of Chinese President Xi Jinping’s visit to Washington, according to people familiar with the talks.
The proposed tariff relief is under discussion as part of an overall package that could include agreements on energy and agricultural trade, as Washington and Beijing work to ease trade tensions ahead of a September 24 meeting between US President Donald Trump and Xi.
The discussions are not final, and the details could still change, the people said. The potential agreement could also involve both countries reducing tariffs on about $30 billion worth of goods each.
China imposed a 15 per cent tariff on American liquefied natural gas in February 2025 in retaliation for US tariffs on Chinese goods.
The measures effectively halted major liquefied natural gas trade between the two countries, with the last significant shipments reaching China early in 2025.
Liquefied natural gas is natural gas cooled to a very low temperature until it becomes a liquid, allowing it to be transported by specialised ships.
It is widely used for electricity generation, industrial production and heating and is traded globally because it can be shipped to countries that lack direct pipeline connections.
The possible tariff reduction would give American liquefied natural gas producers greater access to China, one of the world’s major energy markets.
American producers are also preparing for a large increase in export capacity from new and expanded facilities along the US Gulf Coast, creating a need for additional buyers.
China’s renewed interest in US gas
The talks coincide with signs of renewed interest in American liquefied natural gas among Chinese buyers.
China Gas Holdings, a major Chinese gas distributor, signed a 20-year agreement this month with US-based Venture Global to import 500,000 tonnes of liquefied natural gas annually from 2030.
The agreement marked a resumption of long-term energy trade after Chinese tariffs disrupted US liquefied natural gas imports.
The tariff issue is part of a much larger effort to stabilise economic ties between Washington and Beijing.
Trade disputes between the world’s two largest economies have affected energy, agriculture, technology and industrial goods, while both sides have also imposed restrictions in strategic sectors.
READ ALSO: China Vice Premier To Visit US Ahead Of Trump-Xi Summit
US Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng are scheduled to meet in New York on Sunday for discussions covering trade, artificial intelligence security and other economic issues. The meeting comes days before Trump is scheduled to host Xi at the White House on September 24.
Any agreement on liquefied natural gas would therefore form part of broader negotiations rather than represent a separate energy deal. The proposed tariff changes remain under discussion, with no final agreement announced by either government.
The United States and China have been engaged in a prolonged trade dispute involving tariffs, technology restrictions and access to strategic markets.
Washington has imposed tariffs on a range of Chinese goods, while Beijing has responded with duties on American products, including energy and agricultural commodities.
The rivalry has also expanded into semiconductors, artificial intelligence and other strategic industries.
Despite the tensions, both sides have continued negotiations to protect key trade flows and reduce economic risks.
Energy has emerged as one area where greater trade could provide commercial benefits to both countries.
