EU and the $750-bln energy import conundrum

Which is not a conundrum at all

The EU this weekend sealed a tariff deal with President Trump that involves a commitment to buy $250 billion worth of energy commodities and products annually for three years. That’s in addition to a 15% tariff rate on European exports to the U.S. because Ursula von der Leyen is such an excellent negotiator and an overall winner.

This is not the first time the EU is promising to buy stupendous amounts of U.S. energy. They did it a couple of years ago as well to calm President Biden down because he was angry for some reason that I don’t remember but probably had to do with Russian pipelines. At the time, media commentators were quick to explain why it was not possible to buy the promised volumes, complete with number-crunching. And what do you know, they’ve had to do it again.

Reuters’ Clyde Russell did the number-crunching on the tariff deal first this week, demonstrating that it would be physically impossible for the EU to fulfil its promise to Trump even if it buys all the oil, coal, LNG, and nuclear fuel that the U.S. has for export. The WSJ and the FT followed on Reuters’ footsteps, detailing the impossibility of the undertaking. The hilarious part, however, is that the EU is probably willing to try, especially with LNG. At a very bad time for its LNG security.