Asian countries are looking to purchase more US energy in order to balance trade imbalance

As they try to reduce their trade surpluses with Washington, Asian governments are buying more U.S. gas and oil in order to ease their tariff burdens due to President Donald Trump’s new import duties.

Many Asian countries have large trade surpluses and also are major energy importers.

Trump's tariffs have shook markets and economies.

Here are some measures Asian countries will take to increase their purchases of U.S. gas and oil.

INDONESIA

Energy Minister Bahlil lahadalia said to local media that Indonesia would propose an increase in its imports from the United States of crude oil and LPG (liquefied Petroleum Gas) of around $10 billion, as part of its negotiations on tariffs.

Bahlil stated that the energy ministry recommends increasing the LPG export quota to the U.S. and importing more U.S. oil in order to reach the target.

PAKISTAN

According to a source involved in the proposal as well as a refinery executive, Pakistan may import crude oil for the first to time from the United States to counterbalance a trade deficit that led to higher U.S. duties.

The refinery executive said that they would buy U.S. oil equivalent to Pakistan’s current imports, which is about $1 billion worth of oil.

Four government and industry sources have said that India is considering a proposal to eliminate the import tax on U.S. LNG to increase purchases and reduce the trade surplus, which is a major irritation for President Donald Trump.

The U.S. government also intends to eliminate taxes on liquefied gas and ethane imports.

GAIL India Ltd, the country's largest LNG exporter, has announced a tender for a purchase of up to 26% in a US LNG project combined with a 15 year gas import contract.

THAILAND

Thailand announced on Wednesday that it intends to import more U.S. LNG, ethane and propane over the next five-year period.

Thailand has a plan to purchase more than one million tons of U.S. LNG in the next five-year period. This is on top of an existing plan that will import 1 million metric tonnes of LNG per year worth $500 million as part of 15-year plan beginning in 2026.

Thailand's finance minister also said that it plans to import U.S. Ethane in the amount of $100 million for 400,000 tons over the next 4 years.

ALASKA LNG

Trump wants Japan and South Korea to join the $44billion natural gas project in Alaska as part of Washington’s larger push on trade and tariffs.

The project is aimed at transporting gas from Alaska's remote northern region via a 1,300 km (800 mile) pipeline worth $44 billion. It will be shipped in LNG form to Japan, South Korea, and Taiwan. This bypasses the Panama Canal.

A delegation from Alaska visited Japan late in March to meet with policymakers and discuss possible funding for the project.

Katsuya Nkanishi, chief executive of Mitsubishi Corp, has stated that the Japanese trading company may invest in Alaska LNG, but any decision would require careful consideration.

Officials from the South Korean Ministry of Industry are planning to visit Alaska soon as part working level negotiations between the United States for the project and South Korea.

Taiwanese energy company CPC Corp. signed an agreement last month with Alaska Gasline Development Corp. to invest in and buy LNG. Taiwanese President Lai Ching Te said that this move would guarantee the island's security of energy.

(source: Reuters)