President Donald Trump warned of new trade penalties against South Korea if Seoul fails to proceed with an Alaska liquefied natural gas project, Bloomberg News reported on Saturday.

South Korean officials said they agreed to the venture only if it is economically viable, the news wire said.

It remains uncertain whether Trump can unilaterally raise tariffs on South Korean goods after the Supreme Court limited his tariff authority earlier this year, the publication said.

The exchange risks escalating tensions between the long-standing allies, who have spent months negotiating projects, which make up part of South Korea's $350 billion pledge in US investment last year, the report said.

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