China Drops 125% Ethane Tax Hammer on US Imports—Energy Markets Brace for Ripple Effects

In a move that’ll send shockwaves through petrochemical markets, Beijing just scrapped its punitive 125% tariff on American ethane imports. The sudden policy shift comes as Chinese manufacturers struggle with soaring energy costs—apparently even communist supply chains can’t ignore basic economics.

Why This Matters for Crypto

Cheaper ethane means lower production costs for China’s massive plastics industry—the same sector that churns out hardware wallets, mining rig casings, and DeFi gadget enclosures. Watch for potential margin boosts across crypto hardware plays.

The Cynical Take

Wall Street analysts are already spinning this as a ’de-escalation play’—never mind that China just replaced the tariff with a new blockchain-based import verification system that just happens to run on a state-controlled chain. Modern problems require ’web3’ solutions.

China Expands Tariff Exemptions on US Imports as Trade War Fears Persist

Since early April, the world has been confronted with growing geopolitical tensions between the United States and China. The former announced a sweeping America-first tariff plan on nearly all countries. Subsequently, China’s reciprocal action saw them face import duty increases of up to 245%.

Now, global markets are anxiously awaiting any sign of decreasing tensions between the two sides. In what is a major development, China has reportedly removed its 125% tariff on US ethane imports. Specifically, sources told Reuters that the waiver took place in recent days, although it has yet to be publicly announced.

The ethane imports join a growing list of recent tariff exemptions that have been placed on US goods. Specifically, it joins pharmaceutical, aerospace, and semiconductor products that have received similar exemptions. The nation has removed these tariffs as it attempts to navigate the economic impact of the brewing trade war.

In 2024, China purchased a record 492,000 barrels of ethane from the US per day. Altogether, the second-largest economy in the world was responsible for buying nearly half of all the ethane that the United States exported. In 2025, the US Energy Information Administration projected those exports to increase to 530,000 barrels per day.