Trump Touts Energy Deal With China, but Geopolitical Risks Clouds Outlook
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Prospects for China to resume large-scale imports of U.S. oil and gas remain clouded by geopolitical friction, despite President Donald Trump touting a potential breakthrough after talks with Chinese leader Xi Jinping.
Chinese energy imports from the U.S. have plunged in 2025 as tit-for-tat tariffs escalated throughout the year. Traders and analysts say political risk has now overtaken market fundamentals, with erratic tariff shifts making seaborne cargoes too risky to justify.
Trump posted on social media Thursday that China had agreed to begin purchasing U.S. energy products after his meeting with Xi in South Korea. He said the two sides may ink “a very large scale” deal involving oil and natural gas from Alaska, with discussions to be led by U.S. Energy Secretary Chris Wright and Interior Secretary Doug Burgum.
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- China’s imports of U.S. oil and LNG plunged over 90% in 2025 due to escalating tariffs, with U.S. crude exports to China down 70%.
- Despite talks between Trump and Xi suggesting a large-scale energy deal, political risk and tariffs continue to paralyze trade; Beijing hasn’t confirmed any agreements.
- U.S. energy output remains strong, with projected increases in oil (13.5 million bpd) and LNG exports (15 bcf/d) for 2025.
- 2024：
- China was the world’s top importer of both crude and LNG; the U.S. was China’s fifth-largest LNG supplier and 11th-largest crude supplier.
- As of 2024：
- Alaska’s oil production had declined to 421,000 barrels per day, down from its 1988 peak.
- Feb. 1, 2025：
- The U.S. imposed fentanyl-related tariffs on Chinese exports. In response, China placed a 10% levy on U.S. crude oil and 15% on LNG.
- March 2025：
- The last U.S. LNG cargoes arrived in China before imports halted through at least September 2025.
- First nine months of 2025：
- China imported just 260,000 tons of U.S. LNG worth $157 million, representing a decline of over 90% year-on-year.
- By May 12, 2025：
- China increased tariffs to 20% on U.S. crude oil and 25% on LNG as trade tensions escalated.
- October 23, 2025：
- The U.S. Department of the Interior reversed earlier restrictions, announcing a restart to oil and gas leasing across 1.56 million acres of the Alaskan coastal plain.
- October 30, 2025：
- President Trump announced on social media that China agreed to begin purchasing U.S. energy products after his meeting with Xi Jinping in South Korea; U.S. and Chinese officials held talks in Kuala Lumpur, with the U.S. agreeing to cancel a 10% fentanyl-related tariff and extend the suspension of a 24% reciprocal tariff for one year (through 2026).
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