(Bloomberg) -- Asian fossil fuel buyers looking to appease incoming US President Donald Trump have come to the same conclusion: buy more American oil and gas.
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The re-elected populist leader has threatened tariffs against a number of nations that have trade surpluses with the US, prompting policymakers from South Korea, Taiwan, Vietnam and also the European Union to consider procuring more energy from the world’s biggest producer of crude and exporter of liquefied natural gas.
“Trade partners see buying US LNG as aiding in tariff negotiations with the Trump administration,” said Saul Kavonic, an energy analyst at MST Marquee. There’s been a noticeable and rapid shift toward securing US supply since Trump’s election win, he added.
Such a shift would allow Trump — who has promised his voters a hard pivot back to fossil fuels — to expand US LNG exports beyond the already planned doubling by 2030, as well as give American project developers an edge over rival exporters.
Trump is expected to order changes to encourage domestic oil and gas development immediately after his inauguration on Monday. This could include lifting his predecessor Joe Biden’s moratorium on fresh licenses for LNG export projects — a policy that slowed new sales agreements from 38 in 2022 to just seven last year, according to data from BloombergNEF.
More LNG production from the US is “bright news” for the utilities industry as it could stabilize prices, said Kazuhiro Ikebe, president of Japanese regional power producer Kyushu Electric Power Co. Buyers have been grappling with volatile gas prices since the war in Ukraine began in 2022.
In countries including Japan and Thailand, buyers have renewed talks with US LNG export projects over the last few months, according to traders participating in the negotiations, who added they are eager to sign deals with the US if the price is right.
Roughly half of US LNG exports went to Europe last year, according to ship-tracking data compiled by Bloomberg. And the loss of Russian pipeline gas flows at the start of the year means the continent may also turn to US supply to plug that gap. Trump last month warned the EU that its goods will get hit with US tariffs if its member states don’t buy more American oil and gas.