EU Bends The Knee To Trump: We Could Buy More American LNG
Liberal elites in Brussels talked a big game when former President Trump was out of office, yet as soon as he won the historic election earlier this week, these elites are now, quite literally, kissing his ass to avoid a trade war.
At a press conference on Friday, European Commission President Ursula von der Leyen said the EU still purchases significant amounts of energy from Russia.
She then asked: "Why not replace it by American LNG, which is cheaper for us and brings down our energy prices? It's something where we can get into a discussion, also [where] our trade deficit is concerned."
NEW: President of the European Union commission says they want to start buying oil from the United States and not Russia.
— Collin Rugg (@CollinRugg) November 8, 2024
Trump wins the election and the world falls in line. Remarkable.
“We still get a lot of [liquified natural gas] from Russia, and why not replace it by… pic.twitter.com/E6OwSN6UrR
Von der Leyen's comment about the ability to ramp up American LNG purchases was in response to a comment about how the EU can avoid trade war disputes when Trump returns to the White House on Jan. 20.
Here's more color from Politico on von der Leyen's kind gesture to Trump to avoid a tit-for-tat trade war...
It is likely that von der Leyen is taking her inspiration for a potential deal from her predecessor Jean-Claude Juncker, who engineered a highly cosmetic truce with Trump in 2018.
During the first Trump term, Juncker avoided more tariffs by assuring the US president that Europe would facilitate more imports of liquefied natural gas (and more American soybeans.) In fact, the European Commission has no real power in determining European companies' purchases of LNG and soybeans, but Trump was happy to accept the political theater of parading data that European purchases were going up.
The latest data from IEEFA's European LNG Tracker shows that for the first half of the year, the US has been responsible for about 48% of the EU's LNG imports, compared to Russia's 16%.
According to Aurora Energy Research, an increase in EU imports of US LNG under a Trump administration would cause EU NatGas prices to slide and create a "Trump-driven LNG overbuild on global gas markets" that would lower prices.
Under Trump's administration, LNG export capacity expansion could be swift if a Republican-led government decides to expedite LNG terminal approvals and 'unleash' American energy, starting with the removal of Biden's LNG pause, potentially increasing LNG exports by up to 15% by 2030. The European gas benchmark TTF could decrease by up to 9% compared to Aurora's Central scenario if this were to happen, while Asian gas prices could also decrease by up to 6%. To meet this demand for additional exports, US gas production is projected to grow by 4% by 2030, according to Aurora. However, international LNG exports could still decline, largely due to reduced demand from China if Trump also introduces his proposed universal tariffs.
"The Trump administration would have no direct influence in directing LNG flows away or to the EU, but his administration is likely to remove barriers to LNG terminal buildout capacity that would increase exports, which would suppress European gas prices, as shown in our recent insight report," Sophie Parsons, Senior Analyst for US Gas at Aurora Energy, noted.
Trump hasn't even stepped into the White House. All sorts of moves are happening behind the scenes and then being revealed in the public domain, such as a potential resolution to the war in Eastern Europe and Iran-backed Houthis allegedly declaring a ceasefire.