The EU and the US head towards energy negotiations amid tariff tensions
The European Commission has expressed its willingness to explore the possibility of boosting LNG imports from the United States, according to spokesperson Olof Gill. U.S. President Donald Trump suggested on Monday that this topic might be part of negotiations about modifying tariffs imposed by the US.
Trump stated on Monday that a quick and simple way to resolve the issue would be for them to buy energy from the U.S., which could generate £310 billion (360€ billion) in just a week, as they would be required to purchase and commit to comparable energy volumes. Trump specifically mentioned LNG while commenting on the words of the President of the European Commission, Ursula von der Leyen, who earlier on Monday had revealed that in negotiations with Washington, Brussels had proposed the introduction of mutual zero tariffs on cars and other industrial goods.
The European Commission made this aspect of the behind-the-scenes talks public, as Trump's advisers reportedly include individuals who are very much in favour of this offer. However, the U.S. President stated on Monday that it is insufficient.
To recap, according to the decree signed last Wednesday, a 10% general tariff on imports to the USA has been in effect since 5 April, and on Wednesday, 9 April, tariffs on specific countries are set to be implemented. For the EU, this will be a 20% tariff.
LNG has been on the table from the very start
Unofficially, a source in Brussels reminded that LNG has been on the agenda since the very beginning of discussions with Washington. This is particularly pertinent as the European Union faces challenges in this area because despite its commitment to move away from Russian resources, Russian LNG imports have recently begun to increase. To reduce reliance in this direction, the EU will need to look to other suppliers, with the USA being a natural choice.
The European Commission, responsible for trade policy, stresses openness in negotiations with Washington. Besides zero tariffs on cars and industrial goods, the EC is also willing to negotiate non-tariff barriers, although the US and EU have differing views on what these entail. Brussels excludes discussing VAT issues with Washington, as it regards this solely as a matter of tax policy.
Additionally, in talks about non-tariff barriers (such as quantitative restrictions or technical and phytosanitary standards), the EC would also expect concessions from the United States, which also employs these in its trade policy. Moreover, discussions on non-tariff barriers are considered the most challenging, so resolving them would require extensive time.
There will also be no discussions about the possibility of easing regulations governing the operations of tech giants. This concerns the Digital Services Act (DSA) and the Digital Markets Act (DMA). If any company faces sanctions under these regulations, there will be no question of rescinding penalties.
On Monday, the European Commission proposed to the member states a list of goods from the USA that will be subject to tariffs ranging from 10% to 25% in retaliation for increased steel and aluminium duties. Member states will decide on this by a qualified majority on Wednesday. Some will come into effect in April, the rest in May, with a few goods, like soybeans and nuts, in December.
Then the EU is set to start working on a response to the so-called reciprocal tariffs, those which in the case of imports from the EU will be 20%. The value of the goods affected by these measures amounts to €300 billion.
