On December 20, President-elect Donald Trump stated that the European Union must increase imports of U.S. oil and gas or face tariffs on its exports, including automobiles and machinery. While the EU already purchases the majority of U.S. oil and gas exports, Trump urged the bloc to address its significant trade deficit with the U.S. through larger energy purchases.
The European Commission responded, expressing its willingness to strengthen energy ties and diversify away from Russian supplies. Currently, the U.S. supplies 47% of the EU's LNG imports and 17% of its crude oil imports, according to Eurostat.
Trump’s tariff threats extend beyond the EU, as he also pledged to impose steep duties on imports from Mexico, Canada, and China if they fail to address issues like illegal immigration and fentanyl trafficking. Experts note that such tariffs could disrupt trade flows and lead to retaliatory measures.
Although U.S. energy exports to Europe have surged since 2022, driven by the EU's pivot away from Russian energy, analysts caution that long-term demand is uncertain due to the global transition to renewable energy. Increasing U.S. oil and gas production would require significant investments in infrastructure, which companies may hesitate to make if demand growth is seen as temporary.
