The former president’s power politics could increase sales of liquefied vegetable fuel to a country his election campaign criticized.
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Former President Donald Trump is expanding herbal fuel exports if elected this fall, and an increase in shipments could mean more business with one of America’s biggest enemies: China.
That would put the Trump administration in a complicated position for a moment, because much of the calendar of its crusade focuses on confronting the Asian economic giant and enforcing significant price lists for imported goods from that giant.
Trump is proposing to eliminate key regulations for the LNG sector and would most likely move forward on questionable projects, such as the proposed Louisiana terminal known as CP2. If elected, the Republican leader is also expected to target the most immediate fruits to reap benefits for the sector, such as a DOE requirement that companies export LNG within seven years of the project’s passage.
Analysts say the November election could directly determine how much U. S. LNG is sold globally and to whom. Gigantic volumes of U. S. LNG exports will almost certainly end up in China, the biggest potential new market for U. S. gas, even despite industry protections. are fashionable in the United States.
Many Republicans see a possibility of imposing Chinese concessions on LNG.
“If you could provide your wonderful economic enemy with a source of power for which he would pay money. . . if you could make him addicted to it, thus cleansing his environment, wouldn’t that give you more influence in the end? ? said Rep. Frank Lucas (R-Okla. ), chairman of the Science, Space and Technology Committee, at a hearing in June.
Lucas said LNG export restrictions “limit its ability to build influence with one of its biggest adversaries. “
China is reluctant to signal new long-term contracts with the United States, unlike other suppliers, mavens say. Last year, China Petroleum
The United States Energy Information Administration says Chinese fuel needs will increase by as much as 7% in 2023 compared to 2022, while the country’s LNG import needs will increase by up to 13% in this period.
The Biden administration has complexed many fuel export projects, but the Energy Department suspended approval of new projects in January to evaluate the economic and climate effects of LNG, a fossil fuel that emits greenhouse-resistant methane, when burned or leaked. Environmental outfits like the Sierra Club, Greenpeace and Evergreen Action strongly oppose LNG.
The management also warns that U. S. fuel will give life to the world’s second-largest economy.
“China is the largest potential source of our LNG,” Undersecretary of Energy David Turk said at the June hearing before the House Science, Space and Technology Committee. “They may increase their LNG consumption by up to 65% [until] 2030. “
Some Democratic senators and Sen. Angus King (I-Maine) passed a bill in February banning United States LNG sales to China.
Beyond economic tensions, the pressure for more LNG to be transported to China comes at a delicate time in bilateral relations. The Chinese recently suspended nuclear arms and nonproliferation negotiations with the United States amid heightened tensions over Taiwan. The Federal Bureau of Investigation warns that they oppose Chinese espionage.
At a wide-ranging news conference rife with private attacks on Democratic White House candidate and current Vice President Kamala Harris this month, Trump said he and Chinese President Xi Jinping “had a very good relationship until Covid,” in reference to the coronavirus pandemic. dating back to Wuhan, China, in 2019.
“We let China take advantage of the United States,” Trump said, adding that he hoped to “get along very well with China” if he wins in November.
Karoline Leavitt, press secretary for the Trump campaign, did not comment on a de E
Last year, congressional Republicans tried to force the Biden administration to suspend crude oil shipments to China from an emergency federal reserve. Now, some Republicans are calling for restrictions on other exports to China, such as microchips, arguing that American chips may also allow the country to take the lead in the race for synthetic intelligence. House Republicans are likely to approve several China-related spending next month, according to POLITICO.
Experts say tensions with China will likely persist for years.
“Whoever wins the White House and/or Congress, the pressure on China will increase,” said Christopher Goncalves, managing director and chairman of the Berkeley Research Group’s energy and climate department.
Biden’s leadership says Chinese production endangers American companies. Jay Shambaugh, deputy secretary of foreign affairs at the Treasury Department, recently said that China is contemplating “further boosting manufacturing as an engine of Chinese growth, which means taking on a giant percentage of global production. ” “and added that “China’s trade subsidies are much larger than those granted to industry. “
Tariffs on steel, electric cars and other Chinese goods have risen over the past four years, following a tariff war between the United States and China during the Trump administration. Biden’s team is touting the tax breaks and blank energy subsidies of the 2022 Inflation Reduction Act and the bipartisan Infrastructure Law of 2021 to counter the direction of China’s productive sector.
Dan Byers, vice president of policy at the United States Chamber of Commerce’s Global Energy Institute, said China’s dependence on the United States for energy is “generally one thing. “
China was the sixth-largest destination for U. S. LNG exports in May, according to a recent DOE report. Just over a portion of the country’s LNG shipments went to Asia that month, followed by 38% to Europe.
China relies on locally produced coal and natural energy, LNG and Russian fuel to fuel its economic expansion and military might. The allocation of a Russian pipeline (still under negotiation) to northeastern China, called Power of Siberia 2, could bring in $50 billion. cubic meters of fuel consistent with the year to the Chinese economy, more than double what will be transported between the two countries in 2023.
Under the Trump administration, China imposed price lists on U. S. LNG. The country and its leaders have a specific strategy to feed, observers say.
“They may have simply capitalized smoothly on our years of reliable, reasonable LNG and dependence on us. But they didn’t,” said Courtney Manning, senior studies scientist at the American Security Project. “Beijing knows that if it starts charging or signing contracts for terms of 16, 20 or 24 years, as it does with other countries with more normalized relations, the United States can use that to its advantage. “
In a Columbia University podcast published last month, Erica Downs, a senior fellow at the school’s Center for Global Energy Policy, also rejected the argument that U. S. LNG can seriously influence Chinese politics, saying China has a “long-standing technique for energy supply. “”Security, that is, avoiding dependence on a single supplier.
Some observers say that LNG is a bridge between the two leading economies in the world.
“These economies are so intertwined that it makes more sense to have reliable trade,” Nick Loris, vice president of public policy at the Conservative Coalition for Climate Solutions, said in an interview. Chinese government, and those reasons are legitimate. But I think there are many reasons why we can’t disengage from China either. This requires a balancing act.
To bring U. S. LNG exports to life, the former president will first have to win the election. He will then face serious and demanding situations facing the industry, in addition to festivals in the foreign market, Biden management regulations and environmental lawsuits.
Trump’s allies in the fossil fuel industry are committed to overcoming those obstacles.
“For the environment, the case is clear: We want more American herbal fuel and more capacity to deliver LNG to allies,” Mike Sommers, president of the fossil fuel organization American Petroleum Institute, recently told X.
Project 2025, a blueprint for the current Trump administration, written in part by his former appointees and led by the conservative Heritage Foundation, calls for automatic shipments of LNG to “all of our allies” and calls for eliminating domestic “political and climate interference. ” . of DOE approvals.
Trump has recently distanced himself from the 2025 project as complaints from Democrats about the initiative have increased. The director of Project 2025, Paul Dans, resigned at the end of July.
Trump allies say deregulation would boost exports, create thousands of domestic jobs and reduce carbon dioxide emissions. This technique has the support of many Republicans and some Democrats in Congress.
An industry-backed report released in April found that U. S. LNG emits fewer greenhouse gases than coal in many global markets.
More than 50 House members, plus several Democrats, suggested to the DOE in a letter last month to “quickly review and approve” new LNG projects in the United States, which they called a “win-win for the United States and the global economy. “The bill gaining traction in the Senate would speed up LNG approvals.
But the November election comes as policymakers and the American public debate the price of methane-emitting fuel in a world increasingly devastated by climate change. Many experts say the rosy picture of LNG painted by Trump’s allies is much more complicated.
Climate activists warn that the global expansion of LNG will override greenhouse fuel emissions relief targets and pollute communities at U. S. production sites. Some national security experts say LNG exports threaten the national energy reliability and national security goals of the United States.
The Sierra Club and Greenpeace released a report last week that found air pollutants from LNG export terminals are causing many premature deaths in the United States and billions of dollars in fitness costs, as well as climate damage.
Other analysts have said that exporting U. S. LNG to China could simply reduce that country’s coal consumption.
Global demand for LNG is rising, even as many countries use more renewables and coal to meet electricity demand.
The International Energy Agency, a Paris-based organization designed to strengthen global energy cooperation, said in a recent report that the LNG industry this year “has grown at a rate well above its former average,” noting that “China and India have begun to double again. “10-digit expansion rate in the first part of 2024. ” Shell, a major oil and fuel company, forecasts a 50% expansion through 2040.
But Chinese demand for LNG from Gonçalves is expected to moderate.
“It seems that the customers for expansion in China that we have noticed over the last decade have disappeared, and a much slower expansion in China is now expected over the next five to ten years,” he said.
Biden’s leadership announced a pause in January on the approval of programs to export LNG to countries that have a flexible industrial agreement with the United States, a move welcomed by environmental teams and criticized by the oil and fuel industry.
In July, a federal ruling in Louisiana overturned the freeze, saying the DOE ruling seemed “completely devoid of explanation of why or logic and perhaps the epiphany of ideocracy. “
This month, Biden’s leadership appealed the judge’s ruling to the United States Court of Appeals.
But U. S. LNG exports are expected to grow more than 16% between 2024 and 2025, according to the Department of Energy research agency.
Fauzeya Rahman, LNG market specialist at ICIS Commodities Research Group, said at least five projects were awaiting DOE approval after getting approval from the federal agency, the Federal Energy Regulatory Commission.
Increased U. S. exports are one of the keys to the Republican “drill, baby, drill” campaign.
“I will approve export terminals on my first day back,” Trump said at a rally in Las Vegas earlier this year. “It’s smart for the environment, bad and smart for our country. “
The Trump campaign’s Leavitt said Biden’s leadership caved in to “the radical demands of environmental extremists. “
“The decision to block approval of new United States natural fuel export facilities is still a disastrous self-inflicted wound that will further undermine the United States’ economic and national security,” he said in a statement. “From day one, President Trump will release American Energy. »
Along with extensive deregulation at the federal level, LNG is also a prime precedent for U. S. shale manufacturers who have vast untapped fuel reserves and see their greatest opportunities for expansion and profits abroad.
Ellen Wald, an energy representative and member of the Atlantic Council, predicted that at some point the Trump administration would increase the supply of new LNG facilities to meet demand around the world, adding that in Europe, where many analysts anticipate a decline in gas.
“United States. LNG is the fastest-growing LNG,” he said in an interview. “The concept that ‘Oh, I guess it’s already so approved that we don’t want to pass anymore,’ I think it’s very, very brief. of normal sight. “
“Your allies might want more and you don’t know what’s going to happen 10 years from now,” he said.
Goncalves said Trump would most likely help LNG exports to China, although the scenario is less transparent for a potential Harris administration.
But Paul Bledsoe, a senior professor at American University’s Environmental Policy Center, said Harris will most likely continue Biden’s policy on LNG exports, adding that she will support giant exports to Europe.
“I expect American herbal fuel will continue to play a major role in replacing Russian fuel under the Harris administration,” said Bledsoe, a former Clinton administration official.
Bledsoe, who said he expects the DOE’s review to result in new authorization criteria for LNG exports, said he expects Harris to address rising methane emissions from the United States oil and fuel industry.
Harris’s crusade responded to a request for comment.
Harris’ focus on fighting inflation makes it clear that she will continue to make production cheaper, Bledsoe said.
Bledsoe said he doubted Trump could do much to increase U. S. LNG exports above the existing record levels seen during the Biden administration.
“I don’t think Trump’s policies have any influence on United States oil and fuel production,” Bledsoe said. “Our oil and fuel production is based on market situations rather than government situations,” he said.
“US’s exports will continue to grow, at a slower pace than in the last four years,” Bledsoe said.
Steven Miles, a researcher on herbal fuels at Rice University’s Baker Institute, said that at one point the Trump administration would face a wave of government projects, domestic and foreign, aimed at reducing the emissions footprint of herbal fuels.
The “methane tax,” a U. S. program created under the Inflation Reduction Act, requires oil and fuel companies to pay if methane leaks exceed certain levels. Excess methane produced in 2024 would result in tariffs of $900 per metric ton, and those tariffs would expand to $1,500 per metric ton through 2026.
Miles, who said the methane tax is an example of an “entry tax” on U. S. LNG, noted that Qatar, one of the world’s top LNG exporters, has to pay a methane tax.
“Every time we raise prices for us and for them, we’re faced with an economic problem,” Miles said in an interview.
Tyson Slocum, director of the energy program at the consumer advocacy organization Public Citizen, said that even if Trump could simply order his DOE to factor export authorizations immediately, they would be temporarily challenged in court.
“Trump can do whatever he needs to do from day one and claim that he will pass without delay all those pending and blocked projects, but that won’t make that happen,” Slocum said. “We will exercise our rights as legal interveners and face this challenge in court. »