 "ANNE-SOPHIE CORBEAU")
ANNE-SOPHIE CORBEAU is a global research scholar at the Center on Global Energy Policy at Columbia University’s School of International and Public Affairs. She has more than 20 years of experience in the energy industry and is the author of many publications on gas, LNG markets, Asia, China, India and Africa. Corbeau, in an email interview with S Dinakar, spoke about US President Donald Trump’s energy policy and its likely impact on India. Edited excerpts from an interview:
What would be the impact of China’s retaliatory tariffs on US energy imports (15 per cent on LNG and 10 per cent on crude)?
This is not the first time such a thing has happened. In 2018, following tariffs put in place by the [first] Trump administration, China put tariffs on US LNG. Eventually, this led to a year without any US LNG exports to China (between March 2019 and April 2020).
This time, volumes at stake are higher (China imported around 6 billion cubic meters of US LNG, against 3 bcm in 2018), but China and the US are not too dependent on each other. It is likely that the LNG will again go somewhere else if it's not competitive against other sources of LNG (especially if China increases the tariffs even further).
What does Trump’s energy emergency mean? Two of his executive orders issued within hours of his taking office include the Unleashing American Energy order.
The emergency he is talking about is "an increasingly unreliable grid", requiring swift and decisive action. The emergency is quite centered on electricity, although gas in particular is a key source of this power. US power demand has been quite flat for over a decade, and was expected to increase rapidly in the short and medium terms due to AI (artificial intelligence) and data centres. Now, this might change as DeepSeek [a Chinese startup’s AI service] seems to indicate that there will be less energy needed than they thought.
What he is doing with the National Emergency Act is facilitate the deployment of all domestic energy resources, but not solar and wind. It is possible though that his decisions not to support wind and solar eventually mean a higher domestic gas demand in the power sector, and potentially higher prices.
Will this make the fuels more accessible and affordable for countries like India. What would be the impact on LNG prices?
On whether it makes the LNG more affordable, it depends whether Chinese companies importing US LNG will try to replace it with other LNG sources, replace it by pipeline gas or domestic gas production (unsure they can get as much as 6 bcm though) or reduce their consumption. In the last cases, there will be more LNG available on the global gas market, so that should put downward pressure on prices.
What impact will the orders have on LNG production and projects? Will it improve global LNG supplies and if so by when?
President Trump has stopped the pause of LNG liquefaction projects. There is no doubt that the administration will put pressure on the DOE [Department of Energy] to rapidly review the applications.
In any case, based on existing capacity the US is the largest LNG exporter. And it will remain so based on capacity under construction. The question is how many US LNG plants will take FID (final investment decision) in 2025 and 2026. We can imagine that US LNG exporters have also been working on securing more contracts during the pause. And that many countries/companies may be interested in signing more offtake agreements in order not to have tariffs.
Will India benefit from these orders or will they hurt its economy?
US LNG is usually sold with a Henry Hub plus formulae, which has been used since Cheniere started exporting in 2016. Therefore, the price of US LNG depends first on the Henry Hub price, which has been relatively low over the past decade (with the exception of 2022). As long as Henry Hub prices remain low, then, the price of US LNG will remain competitive. The other element which is important is the cost of liquefaction, which varies depending on the company/companies developing the LNG plant. Historically, we have seen those varying between $2.25 and $3.5/mm Btu. The lower the liquefaction fee, the more competitive US LNG is. That is not something that Trump can decide upon.
Do any of Trump's energy initiatives help India secure oil or gas at an affordable price?
The important thing is that I am not sure Trump is interested in making gas affordable. Competitive, yes. Competitiveness is good, because that means that US LNG is better than competitors. He may be interested in seeing more Indian companies signing long-term contracts to buy US LNG from new LNG export facilities that have not yet taken final investment decisions.
But it also depends on what India deems affordable. I remember an Indian minister saying in 2015 he wanted LNG at $5/mmBtu, which is very low (and there is no US LNG delivered at that price).
What's the impact of America’s withdrawal from the Paris climate agreement? Will it lead to countries like India reducing their climate commitments?
President Trump is not a supporter of clean energy and climate policies. According to him, they are a “green new scam”. But he has not indicated an intent to withdraw from the UNFCCC. That would be more significant than withdrawing from the Paris Agreement.
But other countries are free to take the direction they wish. For example, India is developing renewable energies very fast, and does not seem to change its course, unlike what Trump wants to do in the US.
