US Targets Niche Gas That China Can’t Replace as Trade War Chip

Ethane terminal pipelines and other infrastructure stands inside the Sunoco Logistics Marcus Hook Industrial Complex in Marcus Hook, Pennsylvania, U.S., on Friday, April 8, 2016. U.S. production of ethane, a key feedstock for petrochemical manufacturing, is expected to increase to 1.4 million barrels per day by 2017 as more facilities come online, according to Commodity Online.
Photographer: Luke Sharrett/Bloomberg

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By Nicholas Lua

June 6, 2025 at 8:21 AM UTC

The US is using its dominance of a niche petroleum gas as a bargaining chip in its trade war with China.

America supplies China with almost all of its ethane, a product of the shale boom that’s used as a building block for making plastics. But the commerce department is now ordering shippers to apply for export licenses, and has told at least one, Enterprise Products Partners LP, that it intends to withhold permits for three China-bound cargoes.