The European Union is reducing its reliance on Russian energy supplies and will invest in liquefied natural gas (LNG), oil, and nuclear fuels from the United States, marking a significant boost for the U.S. energy sector.
President Donald Trump announced on Sunday that a “Landmark Trade Deal” was made between the U.S. and E.U. in which the European Union plans to purchase $750 billion worth of energy from the U.S. during the remainder of Trump’s term in office. Those will include spot purchases of oil, long-term contracts for LNG and nuclear technology, with the amount estimated on Europe’s planned phase out of energy purchases from Russia.
“We will also increase our energy cooperation. Purchases of US energy products will diversify our sources of supply and contribute to Europe’s energy security,” European Commission President Ursula von der Leyen said in a statement over the weekend after she met with Trump in Scotland.
Andy Lipow, president of Lipow Oil Associates, told FOX Business that the “deal solidifies the energy ties as the U.S. continues to be a major exporter of crude oil and refined products with a growing LNG export business.”
The deal also comes at a key moment. The E.U. is imposing sanctions on Russia, which affects refineries in China and India that used to turn Russian oil into diesel and sell it back to Europe. Lipco said Europe will now look to the U.S. to help make up for the loss.
“If the U.S. adds more sanctions on countries that still buy Russian oil, it will likely bring the U.S. and Europe even closer when it comes to energy cooperation,” he added.
Under the deal, the E.U. said it will also invest an additional $600 billion beyond its existing commitments. This figure is based on the combined investment intentions expressed by European companies, though those private companies’ ultimate actions are beyond the control of the E.U., an economic and governmental bloc.
TRUMP’S MASSIVE ECONOMIC TRADE DEAL WITH EU: WHAT TO KNOW
EXXONMOBIL CEO TALKS OIL SUPPLY AMID IRAN-ISRAEL CONFLICT
The U.S.-E.U. trade deal framework will also see E.U. member states commit to buying U.S. military equipment, although the amount isn’t specified by the deal.
Von der Leyen continued saying that the deal between the E.U. and the U.S,. “creates certainty in uncertain times.”
“It delivers stability and predictability, for citizens and businesses on both sides of the Atlantic,” she said, adding that the U.S. and E.U. trade $1.7 trillion with each other every year and represent a market of 800 million people and make up nearly 44% of the world’s economy combined.
Read the full article here
