The resumption is driven by urgent supply needs following disruptions in the Strait of Hormuz linked to the ongoing Iran conflict, which has significantly affected Middle Eastern LNG flows to Asia.
As of July 16, 2026, China has received its first direct shipment of US liquefied natural gas (LNG) in over a year. The LNG carrier Al Fat’h, loaded at Venture Global’s Plaquemines facility in Louisiana in June, docked at Yangpu port in southern China. This marks the end of a boycott that began in February 2025 when Beijing imposed tariffs on US LNG in response to escalating trade tensions.
Background and Timeline
Pre-2025 Trade: US LNG exports to China grew after the first shipments in 2016, but faced volatility due to tariffs and geopolitical tensions.
February 2025 Halt: China stopped direct imports and applied tariffs amid a broader US-China trade war under President Trump’s second term. Limited indirect volumes occurred via transshipments, but direct trade largely ceased.
May-June 2026 Restart Signals: Following the Trump-Xi summit and amid rising global energy prices, multiple US LNG vessels (from Cheniere’s Sabine Pass and Venture Global’s Plaquemines) departed for China, with arrivals expected in June. This shipment represents the materialization of that shift.
July 2026 Confirmation: The Al Fat’h arrival confirms the restart.
Hormuz Disruption and Energy Security
The Strait of Hormuz, a critical chokepoint for global oil and LNG, has faced severe disruptions since early 2026 due to the Iran conflict. This has blocked or delayed roughly 20% of global LNG trade and a significant portion (around 30% in some estimates) of China’s LNG supply, which relies heavily on Qatari and other Middle Eastern cargoes.
Impacts on China
LNG imports initially plunged in March-April 2026 but rebounded in May-June through diversified sourcing.
Non-Middle Eastern supply share rose sharply (to 82% in H1 2026), highlighting Beijing’s pivot to Atlantic suppliers like the US.
Higher Asian LNG prices and the need for reliable molecules outweighed prior tariff/political considerations.
US Side
New export capacity (e.g., Plaquemines, Corpus Christi Stage 3) has increased available volumes.
US Henry Hub gas prices remain competitive globally.
The long shipping route (visible in the map from the original post) avoids the disrupted Hormuz area, routing around Africa or using alternative paths, adding to costs but securing supply.
Broader Market Context
Shell and others forecast flat or stalled growth in 2026 due to Hormuz issues, with recovery expected in 2027 and strong demand growth to 2050 (driven by Asia). As the world’s largest LNG importer, China is balancing short-term needs with long-term goals of diversification, renewables, and domestic production. The restart signals pragmatic energy diplomacy, potentially easing some bilateral tensions while underscoring US LNG’s role as a “swing” supplier in crises.
This development could pave the way for more consistent US-China LNG trade if Hormuz risks persist or if tariffs are negotiated down. However, it remains vulnerable to shifts in trade policy or Middle East stabilization. Watch for follow-on cargoes and official trade data in coming weeks. The story highlights LNG’s strategic importance: molecules often prevail over politics when supply security is at stake.
/X, Shell, Bloomberg, Reuters/