Trade war will impact energy maritime transport

Imagen: Cheniere Energy

The trade war between the United States and China will also affect international maritime transport of Energy as a result of the tariffs previously imposed Chinese products, as a response, China now proposes to impose tariffs on imports of LNG (Liquefied Natural Gas), oil and coal, according to Reuters.

Among the list of commodities that would also be included in the list are Oak wood and copper ore. however, the tariffs imposed by the United States are directed mostly to finished products such as computers and IT network equipment (Technology and Information).

According to Panjiva, the tariffs that China would impose on the United States represent 56% of US imports. This figure does not compare to the impact of tariffs imposed by the United States since the trade balance favors China. Therefore, China’s reaction will not be symmetric, but will implement other measures. These measures would include refraining from the payment of taxes by companies owned by the Chinese government to the United States. Additionally, simply bring the tariff rates all to 25% by China

However, an increase in demand for LNG in China is projected to counteract dependence on coal and improve air conditions. This would change the current landscape of the geography of LNG transport; imposing tariffs on gas from the United States would transfer the demand to Russia, its direct competitor, who supplies it by pipeline, therefore, does not demand maritime transport. Additionally, other suppliers that could benefit would be Australia, as the fourth largest producer of Liquefied Natural Gas, Indonesia and Malaysia.

Future outlook

Under this scenario, the United States would not become the third producer of LNG in the world due to the implementation of the tariff by China. Finally, analysts mention that it could be considered a friendly exit from this commercial war but that it would continue until 2019.

Source Forbes

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