Long-term US-China liquefied natural gas trade will bring strategic benefits to both countries

Despite a wide range of challenges within the US-China relationship, liquefied natural gas (LNG) trade is one of the few areas that brings strategic benefits to both countries. In the United States, building and operating LNG infrastructure provides significant economic benefits to communities across the country. Internationally, to achieve the Biden-Harris administration’s global climate ambitions, cooperation between the United States and China on cleaner sources of fuel will not only have the highest impact on reducing global carbon emissions, but will also encourage other countries to adopt more ambitious climate commitments. In China, the long-term supply of US LNG supports Beijing’s climate and air quality goals by replacing coal with much less carbon-intensive natural gas across industrial, power, and residential sectors and by complementing the increase in the share of renewable in the power sector. Additionally, Henry Hub-linked US LNG reduces China’s exposure to oil price-linked contracts across its imported energy portfolio and improves the long-term stability of energy prices in China.