Back when President Donald Trump and President Xi Jinping were best buds they announced a deal in principle that would expand Chinese purchases of liquified natural gas from the United States in general and Cheniere Energy (LNG) in particular.
I think we can assume that deal is off the table for quite some time. The market seems to agree. Today when the entire market–and the energy sector–dropped, shares of Cheniere Energy fell 2.8% to close at $62.43.
I think the uncertainty (worry? fear?) set off by this latest round of trade retaliation is likely to persist for a while. There aren’t even any negotiations scheduled at this point between the two countries.
Shares of Cheniere Energy are still ump 15.95% for the year as of the close on July 11–although they were up 27.64% back on June 22.
I think it’s wise to sit this one out for a while. The Chinese have plenty of alternative sources for liquified natural gas and the LNG market is likely to be in chaos for a while.
I’m selling Cheniere Energy out of my Jubak Picks portfolio (although leaving it in the long-term 50 Stocks portfolio) as of tomorrow, July 12. This position was up 124.9% since I added Cheniere Energy to Jubak Picks on June 25, 2013.