New tariffs on Chinese imports could make it harder for U.S. liquefied natural gas exporters to tap into China’s booming market and raise billions for the next generation of Gulf Coast LNG facilities. If the Trump Administration follows through on plans to impose tariffs targeting roughly $60 billion in Chinese goods per year, the new trade policy could further complicate a complex relationship and add another layer of risk that could scare off investors already jittery about doing business with China. LNG operators need to line up long-term contracts to gain the financing and investment needed to build multibillion dollar projects that convert natural gas to a liquid form and ship it to foreign markets. Investors and lenders were already wary about Chinese buyers honoring contracts for the full-length of their 20-year term. A trade war that could drive the Chinese to buy LNG from Australia, the Middle East or other U.S. rivals only adds to the uncertainty for investors and the projects. “Contracts with Chinese buyers may be off the table for the next wave of projects,” said Katie Bays, an energy investment analyst at the consultancy Height Capital Markets in Washington.
Steel tariffs will hurt operating companies and mid-stream companies. There is no portion of the oil and gas business that will not be harmed to some extent. Ultimately it is consumers who will bear the cost of tariffs and any resulting trade war.
I read somewhere months ago that there is no drill stem being produced in the US today. It's all imported. I don't know about pipe for NG pipelines, but the tariff is highly inconsistent with the goal of US dominance in energy production.
But, then, what do I know?
More than the guy in charge! Obviously.
These tariffs, and trade imbalances are the same issues that are faced by the mineral owners on this site. Trump is only looking at what is fair. He starts sky high, and meets somewhere in the middle. As far as steel goes China for years now has been sucking up all our recycled steel at recycle rates, smelting it all back together and shipping back inferior grade steel, as high grade carbon steel. Just sayin.
The steel mill in my area just brought back 500 jobs to there cold roll milling operations. with plans to restart 2 more furnaces in the coming months. these are 80,000 dollar year jobs, with that money going back into buying gas for those big trucks, the workers will be buying with those big paychecks.
Regardless of any relatively minor benefit to steel and aluminum firms and their workers, the increased cost will fall on all consumers. The steel industry made poor management decisions decades ago that are part of their current problem. Tariffs are a terrible idea even if they don't spark a global trade war.
Always happy to hear about US industry cranking back up.
If we go back 30 years ago, lots of US O&G industry abandoned US made steel products in favor of Japanese products over quality, not price. I don't doubt that China dumps steel products in the US, but the US general public needs to understand that there will be a price to pay, by that same general public, for the tariffs. That will affect future LNG exports where the US is competing with Australia and others. Which will then affect domestic gas prices and future drilling plans, which finally gets down to my own finances as a royalty owner. So, the US consumers will pay a price, and NG royalty owners will likely be paying a higher price for these tariffs. Lots of trade-offs here, and I don't feel confident that those trade-offs were thoughtfully considered. Hopefully, the pipe quality issues will not be another problem.
Much of the heavy-wall tubular products haven't been made in America for many years. The energy industry is set to take a heavy hit without an exemption for critical products.
Trump doesn't know crap about steel or anything worth knowing. Any policy stuff that comes down the pike is implemented by the powers that be in his circle, not him. He doesn't have the mental capacity to even rationally discuss the economics of a tariff. Don't give him so much credit. Watch out, America!
Here we go. Bullies like to pick fights, until they get punched in the nose.
"President Trump embarked Thursday on the sharpest trade confrontation with China in nearly a quarter-century, moving toward imposing tariffs on $60 billion in Chinese goods and limiting China’s freedom to invest in the U.S. technology industry.
The Chinese government fired back hours later, threatening to hit $3 billion in U.S. goods with tariffs. Trump’s announcement was “typical unilateralism and protectionism,” China’s Commerce Ministry said in a statement, and it had set a “very bad precedent.”
“China does not want to fight a trade war, but it is absolutely not afraid of a trade war,” it said in a statement issued Friday morning in Beijing. “We are confident and capable of meeting any challenge. It is hoped that the U.S. side will be able to make a swift decision and not to drag bilateral economic and trade relations into danger.”