US President-elect Donald Trump said on December 20 that the European Union should step up US oil and gas imports or face tariffs on the bloc’s exports that include goods such as cars and machinery.
“I told the European Union that they must make up their tremendous deficit with the United States by the large-scale purchase of our oil and gas,” Trump said in a post on Truth Social.
“Otherwise, it is TARIFFS all the way!!!,” he added.
The EU already buys the lion’s share of US oil and gas exports, according to US government data.
No extra volumes are currently available unless the United States raises output or volumes are re-routed from Asia, another big consumer of US energy.
The European Commission said it was ready to discuss with the president-elect how to strengthen what it described as an already strong relationship, including in the energy sector.
“The EU is committed to phasing out energy imports from Russia and diversifying our sources of supply,” a spokesperson said.
According to data from the EU statistics office Eurostat, the United States already supplied 47 per cent of the European Union’s LNG imports and 17 per cent of its oil imports in the first quarter of 2024.
Trump has vowed to impose tariffs on most if not all imports and said Europe would pay a heavy price for having run a large trade surplus with the US for decades.
Trump has repeatedly highlighted the US trade deficit for goods, but not trade as a whole.
Eurostat data shows the US had a goods trade deficit with the EU of €155.8 billion last year.
However, in services it had a surplus of €104 billion.
Trump, who takes office on January 20, has already pledged hefty tariffs on three of the United States’ largest trading partners – Canada, Mexico and China.
Most European oil refiners and gas firms are private and the governments have little say on where the purchases are coming from unless authorities impose sanctions or tariffs. The owners usually buy their resources based on price and efficiency.
The EU has steeply increased purchases of US oil and gas following the block’s decision to impose sanctions and cut reliance on Russian energy after Moscow invaded Ukraine in 2022.
The United States has grown to become the largest oil producer in recent years with output of over 20 million barrels per day of oil liquids or a fifth of global demand. It exports all the crude it cannot consume at home.
US crude exports to Europe stand at around two million barrel per day, representing over half of US total exports with the rest going to Asia.
According to the US government data The Netherlands, Spain, France, Germany, Italy, Denmark, and Sweden are the biggest importers.
“Europe is taking close to its maximum capacity for US crude, meaning there is little scope for stronger imports next year,” said Richard Price, oil markets analyst at Energy Aspects.
He also said refinery closures in Europe in 2025 won’t help increase imports.
The United States is also the world’s biggest gas producer and consumer with an output of over 103 billion cubic feet per day.
The US government projects that US exports of liquefied gas (LNG) will average 12 billion cubic feet per day in 2024.
In 2023, Europe accounted for 66 per cent of US liquified gas exports, with the UK, France, Spain and Germany being the main destinations.
EU exports are dominated by Germany with key goods being cars, machinery and chemicals.
