Trump’s love affair with the EU’s $750 billion energy promise is built on shaky ground
U.S. President Donald Trump says the European Union ‘s $750 billion energy pledge will help to revitalize the world’s largest economy, although analysts question whether the 27-nation bloc’s target is in keeping with market reality. Speaking to CNBC’s ” Squawk Box ” on Tuesday morning, Trump lauded recent trade deals with both the EU and Japan , saying the U.S. stands to take in trillions of dollars from these agreements. “I got a signing bonus from Japan of $550 billion. That’s our money. It’s our money to invest as we like. The European Union, $650 billion, think of it,” Trump said, adding that the EU has committed to purchasing $750 billion of U.S. energy over the next three years. “Think of it, they’re going to put up $750 billion. We’re a rich country again,” he added. His comments came shortly after the U.S. established a tariff ceiling of 15% for most EU goods from the start of August. The framework agreement was significantly lower than the 30% tariff rate previously threatened by the U.S. president, but above the 10% baseline the EU had been hoping for. Under the terms of the pact, which European Commission President Ursula von der Leyen described as a ” good deal ” at the time, the EU said companies in the bloc expressed interest in investing at least $600 billion in various sectors by 2029. The EU also intends to purchase U.S. liquefied natural gas (LNG), oil and nuclear energy products with an expected offtake valued at $750 billion over the next three years, seeking to replace Russian energy on the EU market. Read more CNBC Transcript: President of the United States Donald Trump Speaks with CNBC’s “Squawk Box” Trump’s tariff playbook comes with a baseball twist Trump strikes EU trade deal with 15% tariffs Emre Peker, director for Europe at political risk consultancy Eurasia Group, said neither the EU’s $600 billion investment pledge nor the $750 billion energy promise were realistic targets, “especially not in the way Trump characterized them on Squawk Box — that is, as a gift that he will use to invest in whatever he wants.” “The key to keeping the EU-US trade deal on track will be demonstrating rising EU energy purchases and investments in the US,” Peker told CNBC by email. “As long as the trend line is favorable to the US and helps even the transatlantic trade balance, Europeans are likely to keep Trump on board with the current arrangement of a 15% all-in tariff. This tactic worked during Trump’s first term, with the EU demonstrating soaring LNG and soybean imports from the US.” Underlining problems with the feasibility of the EU’s energy pledge, Peker said even if the bloc bought all U.S. crude, LNG and coal exports at current prices, it would amount to less than $170 billion annually — still well below the $250 billion target for each year. When asked about any potential consequences from the EU failing to make the proposed investments, Trump said the bloc would face tariffs of 35%. “No, they bought down their tariffs. So, they paid $600 billion and because of that I reduced their tariffs from 30% down to 15%,” Trump said. For its part, the European Commission said it was able “to present a coherent, non-binding commitment” to the U.S. on estimated EU investment over the coming years following engagement with industry and other relevant stakeholders. ‘A negotiating tactic’ “I think it is a negotiating tactic, but I would have expected the EU to come up with the first round to be more realistic and more favorable to the EU,” Ana Maria Jaller-Makarewicz, lead energy analyst for the Europe team at the Institute for Energy Economics and Financial Analysis (IEEFA), told CNBC by video call. On LNG, for example, EU imports from the U.S. nearly tripled between 2021 and 2023, reaching a peak of 60.7 billion cubic meters (bcm), according to data from Kpler and IEEFA’s European LNG tracker. The EU’s LNG imports from the U.S. dipped last year, before picking up steam again over the first half of 2025 and putting the bloc firmly on track to surpass its previous full-year record. “How much more are we going to buy?” Jaller-Makarewicz said. She pointed out that for the EU to meet its annual commitment of $250 billion of energy products over the next three years, the EU would need to source about 70% of its energy imports from the country, a prospect that raises supply security concerns. Market dynamics Simone Tagliapietra, a senior fellow at Brussels-based think tank Bruegel, has also questioned whether the energy component of the EU-U.S. trade deal can be fulfilled. “EU total energy imports from the US amounted to around $70 billion in 2024. The deal implies to suddenly more than triple this volume for the next 3 years. This is unlikely for both demand and supply reasons,” Tagliapietra said in a LinkedIn post published last week. On the demand side, Tagliapietra said, ratcheting up the U.S. share in EU energy imports is likely “easier said than done,” noting market dynamics define energy companies’ choices and the European Commission has no say on this matter. The additional U.S. export capacity for LNG, oil and nuclear fuel, meanwhile, may take longer to develop than the built-in three-year time horizon, he added. “Energy trade has always been a key item in the EU-US trade dialogue in the last years, but market dynamics rather than political declarations have been the determining factor here,” Tagliapietra said. — CNBC’s Silvia Amaro contributed to this report.
