The US liquefied natural gas (LNG) industry has issued a strong warning to the Trump administration, saying it cannot comply with new shipping rules that threaten to disrupt America’s booming energy export business. According to a report by the Financial Times, industry leaders fear that the new measures could seriously harm the country’s $34 billion-a-year LNG sector, a key pillar of the President Donald Trump’s “energy dominance” agenda.
The rules, unveiled by US Trade Representative Jamieson Greer on April 17, are part of Washington’s efforts to exert pressure on China over alleged unfair trade practices and to boost US shipbuilding. They impose levies on Chinese-built ships docking at American ports and encourage a transition toward US-built and flagged vessels. However, the LNG industry has raised concerns that these new tariffs will dramatically raise costs and threaten America’s standing as the world’s top LNG exporter.
In letters sent this week to the Departments of Energy and Interior, the American Petroleum Institute (API) cautioned that it would be “impossible” for LNG exporters to meet the new requirements. As cited by the Financial Times, the API stressed there are currently no US-built vessels capable of transporting LNG, nor is there sufficient capacity at domestic shipyards to construct the necessary fleet before a 2029 deadline.
“The rules would compromise US producers’ ability to dominate the global LNG industry and cement America’s position as the global energy superpower,” the API warned. Industry leaders are also concerned that the move could set a dangerous precedent, allowing future administrations to suspend export licenses under similar trade pressures.
Although the USTR is offering a 22-year phase-in period for compliance, LNG companies remain anxious. Charlie Riedl, executive director at the Center for LNG, noted that the new measures could destabilize long-term contracts, increase costs for global buyers, and ultimately undermine America’s competitive advantage. “That’s why we have urged USTR to exempt LNG shipping and LNG carriers from this action entirely,” Riedl told the Financial Times.
Aaron Padilla, API’s vice-president of corporate policy, acknowledged the broader goal of countering China’s discriminatory practices but emphasized the need for “feasible and durable policies” that protect US competitiveness. “We will continue working with USTR and the Department of Energy in support of feasible and durable policies that benefit consumers and advance American energy dominance,” Padilla said.
The United States overtook Australia in 2023 to become the world’s largest LNG exporter, shipping 11.9 billion cubic feet per day — enough to meet the combined natural gas needs of Germany and France. The sector has ambitious plans to double exports by the end of the decade.
The new rules are part of a wider set of maritime tariffs that would charge vessel owners and operators from China $50 per net ton starting in 180 days, with annual increases thereafter. Even companies from other countries operating Chinese-built ships would face a lower, but still significant, levy.
Other US export industries, including agriculture, have joined the chorus of concern, warning that the rules could drive up freight costs and disrupt carefully balanced supply chains.
Despite the oil and gas sector’s past success in securing favorable concessions from the Trump administration, this latest dispute highlights growing tensions between industry goals and Washington’s increasingly aggressive trade policies.
