President Donald Trump has asked the European Union to step up its purchases of crude oil and liquefied natural gas from the United States if it wants to avoid tariffs on all imports, Oilprice.com reported.
“One of the things they can do right away is buy our oil and gas,” President Trump told the media on Monday, Bloomberg reported. “We’re going to solve this problem with tariffs, or they’ll have to buy our oil and gas.”
On his first day in office, the president lifted a so-called moratorium on building new LNG export terminals that the Biden administration had imposed on the industry after a study claimed that LNG exports have higher carbon emissions than coal.
The United States became the world’s largest LNG exporter within a few years, and also the largest supplier to Europe by 2022 and after most Russian pipeline flows are halted. Before 2022, U.S. LNG exports to the continent averaged 15 million tons per year, but jumped to 55 million tons in both 2022 and 2023.
The past year has been more difficult as Europe has begun to feel the effects of rising energy prices, a combination of problematic economic growth and reduced competitiveness of European industry.
Europe’s job is made even more difficult by long-term contracts. Europe generally prefers to purchase LNG from the spot market, with EU authorities insisting on greater independence, despite the price premium there. But U.S. LNG exporters have committed significant volumes to buyers in long-term contracts, leaving European buyers who love the spot market with less leeway, according to Bloomberg’s Steven Stupczynski.
This clearly shows that Europe is following President Trump’s call to rebalance the trade deficit that the United States has with one of its major trading partners, even if it really wanted to. However, this means that it is difficult to respond.
MNA