China's Tariffs on U.S. Oil and LNG Could Disrupt Trade, Prompt Waiver Requests

China's planned tariffs on U.S. crude oil and liquefied natural gas (LNG), set to take effect on February 10, are expected to prompt traders to seek waivers, trade sources said. Beijing announced a 15% levy on U.S. LNG and a 10% duty on crude oil imports, following new U.S. tariffs imposed by the Trump administration.

Currently, four tankers carrying six million barrels of U.S. crude and two LNG vessels are en route to China, according to Kpler and LSEG data. Traders anticipate waiver requests for booked shipments but see challenges for future deals. A Chinese trade source noted that reselling U.S. oil may be unfeasible due to unfavorable pricing.

Unipec, the trading arm of Sinopec, is expected to adjust its strategy by increasing swaps with Korean and Japanese buyers or selling more to U.S. customers, a source said. Sinopec declined to comment.

At least eight Very Large Crude Carriers (VLCCs) have been booked by major firms, including Vitol, Gunvor, Occidental, ExxonMobil, and TotalEnergies' trading arm, ATMI. These companies typically do not disclose commercial activities.

For LNG, PetroChina-controlled vessels Mu Lan and Wudang are scheduled to arrive in China soon. Analysts predict U.S. LNG exports to China will drop significantly as buyers turn to Qatar, Russia, and other suppliers.

U.S. oil shipments currently en route to China include the Sea Lion, Sonangol Huila, Ulysses, and Kondor tankers, with estimated arrivals between February and April. The upcoming tariffs are expected to shift global trade flows, favoring alternative Asian and European markets.