China inks first term deal for US LNG since a trade war erupted

China inked its first term deal to buy liquefied natural gas from an American exporter since the trade war disrupted deliveries, a sign of confidence that relations with the US could be normalizing, Report says, citing Bloomberg.

Foran Energy Group said it signed a framework agreement with US producer Cheniere Energy Inc. to purchase 26 cargoes between 2021 and 2025. The deal was made during the annual trade fair in Shanghai, a signature project of President Xi Jinping designed to showcase China’s openness to the world. Prices will be linked to the US Henry Hub benchmark.

Chinese firms had stopped signing longer-term supply contracts with US exporters after Beijing slapped tariffs on shipments in retaliation to US levies on Chinese goods in 2018. A long-negotiated supply deal between Cheniere and Sinopec, China’s refining and petrochemicals giant, never materialized due in part to the trade spat.

American LNG sales to China stopped completely between May 2019 and March this year. Imports have since resumed as Beijing looks to honor its commitments to the phase-one trade deal signed with Washington in January, even as broader political relations between the world’s two largest economies have been stretched almost to breaking point.