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President Trump is aiming to push U.S. energy forward in his trade talks, but so far, the details shared about any agreements have been sparse, and the actual results remain somewhat unclear.
In a recent development, the Trump administration along with the European Union revealed a trade agreement. Under this deal, the EU is set to purchase “$750 billion in U.S. energy” by the year 2028.
The EU’s website indicated that the agreement “aims to procure more U.S. liquified natural gas (LNG), oil, nuclear fuels, and cutting-edge technologies, as well as investments over the upcoming three years.”
On Wednesday, there was an announcement about another agreement with South Korea. This deal includes purchasing “$100 Billion dollars worth of LNG or other energy products,” according to Trump’s social media remarks.
These recent deals follow a previous one with Japan last month. The Japanese agreement involves $550 billion directed toward U.S. sectors such as energy infrastructure, semiconductor manufacturing, and mining.
Reuters noted on Monday that a trade agreement was also sealed with Malaysia. This includes a pact where Malaysia’s state energy firm, Petroliam Nasional Berhad, commits to buying $3.4 billion annually of U.S. LNG.
While there appears to be a focus on energy in these deals, in many of them it’s not clear exactly what kind of energy will be purchased in what quantities, who will supply it or who will buy it.
“There are a lot of still open questions,” said Aaron Bartnick, who served as an economic security official in the Biden White House.
Clara Gillispie, a senior fellow for climate and energy at the Council on Foreign Relations, said, “There’s still a lot we don’t know about what these deals look like, including in terms of how ambitious these actually are.”
She said part of the issue is that it’s not clear what even counts as “energy.”
“You have in some of the detail deals references to energy products. Some say energy exports from the U.S. LNG is often referenced as part of a suggestive, but not necessarily all inclusive list.”
Bartnick, who is now a fellow at Columbia University’s Center on Global Energy Policy, said that the deals would be expected to result in the purchase of more U.S. energy “if the terms as outlined, are executed.”
But that’s a big if.
“I’ll be very interested to see how these foreign governments work with the private companies in their respective countries in order to coordinate these investments,” he said.
On the U.S. side as well, decisions are made by private companies, rather than anything run by the state, and in many cases, if deals were economic, it’s possible they would have already been made with or without a trade deal.
However, Gillispie noted that “there are things that governments can do to more positively influence the competitiveness of U.S. energy supplies in their own markets.”
“You could, for example, see governments look at waiving of certain import taxes or other fees that might be levied against energy imports, specific to waiving them in the U.S. case,” she said.
Olympe Mattei-d’Ornano, a European gas analyst at BNEF, said in a statement shared with The Hill that the EU deal in particular may be difficult to actually achieve.
“Total energy imports from the US accounted for less than $80 billion last year vs $250 billion promised. The pledge is not legally binding but could spur a gesture from the EU’s side to provide incentives/guidelines to increase EU buyers’ contracts with US LNG projects,” said Mattei-d’Ornano.
She indicated that at least some of the purchases may have happened anyway, “given the pivot away from Russia in recent years.”
However, the U.S. energy industry has appeared supportive of the Trump administration’s efforts.
“We welcome President Trump’s announcement of new trade frameworks that will expand new export market opportunities and support American energy development,” said Rob Jennings, vice president of natural gas markets at the American Petroleum Institute, a major oil and gas lobbying organization, in a statement to The Hill.
Jennings, however, also called for a faster infrastructure buildout in the U.S., saying “we can provide even more of that supply to our allies with more infrastructure.”