A kinetic theory that describes the time evolution of a fluid consisting of Lennard-Jones particles at all densities is proposed. The kinetic equation assumes binary collisions, but takes into account the finite time duration of a collision. Furthermore, it is an extension of a kinetic equation for the square well fluid as well as the hard sphere Enskog theory. In the low density limit, the Boltzmann theory is obtained. It is shown that the proposed theory obeys all the conservation laws. The exchange of potential and kinetic energies is studied and it is shown that at high density this is a fast process. The dominant mechanism for energy exchange is found to be collisions at the strongly repulsive part of the potential that are disturbed by third particles. The kinetic equation is also used to calculate the Green-Kubo integrands for shear viscosity and heat conductivity. The major structures found in molecular dynamics simulations are reproduced at intermediate densities quantitatively and at high density semiquantitatively. It is found that at high density, not only correlated collisions have to be taken into account, but that even the concept of collisions in the sense of sudden changes in the velocity is no longer useful.