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Europe Eyes Energy Options in US Tariff Negotiations

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Energy is widely seen as a negotiating tool for countries looking to avoid US tariffs. The EU, already a major importer of US energy, is now considering what it might be able to offer in such talks. This week, the European Commission, which negotiates trade on behalf of the 27 EU member states, presented a list of concessions and potential retaliatory measures it will offer the US — including those involving energy — in hopes of securing a reprieve from US tariffs. Brussels is reportedly willing to increase investments in foreign energy projects and potentially water down some of its climate regulations and other trade restrictions to appease Washington. The EU has also been studying the increase in US LNG purchases to reduce the trade deficit between the two powers. US President Donald Trump has signaled that one way the EU could make an alleged $350 billion trade deficit "disappear easily and quickly" is to buy US energy, notably LNG. The US is already the EU’s largest supplier of LNG, shipping 43.8 million tons to member states in 2024, worth about $13 billion. That accounted for some 45% of the EU's total LNG imports last year. The US is also a significant supplier of liquids to the EU, sending about 1.9 million barrels per day of crude and 950,000 b/d of total products to Europe in 2024, according to ship-tracker Kpler. However, liquids demand in Europe has largely peaked, while gas demand is expected to stay strong at least through this decade.

Topics:
Tariffs, Trade, Policy and Regulation, LNG Trade, LNG Supply, LNG Contracts, Gas Supply
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