The energy landscape in Europe is shifting, and it’s not just about renewables. With Donald Trump eyeing a return to the White House, his focus on selling more American gas to Europe is creating ripples across the continent. But is this a done deal? Not so fast. This article explores the complexities of Europe’s energy pivot, revealing why a simple switch isn’t as straightforward as it seems.
Here’s what we’ll cover:
- The current energy situation in Europe
- How Russia has been a major player, and why that’s changing
- The EU-US gas trade agreements
- The bottlenecks and challenges standing in the way
- The potential impacts of Trump’s policies
Europe’s Gas Dilemma: A Quick Recap
Before the Russia-Ukraine conflict, Europe relied heavily on Russian gas, with a staggering 47% of its supply coming from Moscow. But times have changed. In 2024, this number plummeted to just 13%. This is because of Moscow’s cuts in exports, and Europe’s push towards renewables and other fuel sources.
While Europe is trying to ditch Russian energy, it still imports a hefty 50 billion cubic meters (bcm) of it. That’s why Brussels wants to cut all ties to Russian gas by 2027.
Did you know that Russia was Europe’s top energy supplier for decades? It is also the largest natural gas exporter globally, wielding a huge influence on energy pricing.
Enter Uncle Sam: The US Gas Push
The United States is stepping up its game. In 2022, President Biden committed an extra 15 bcm of Liquified Natural Gas (LNG) to Europe, with a plan to reach 50 bcm by 2030. Then, in 2025, things got even more interesting when Ukraine stopped a vital Russian gas pipeline. This chopped another 15 bcm of Russian flow. It’s like the pieces of the puzzle are falling into place. Or are they?
Last year, LNG accounted for 29% of Europe’s gas supply, up from a mere 18% in 2019. American LNG made up half of all those imports, making the US a key player. But can the US truly fill the gap?
The Roadblocks Ahead: It’s Not That Easy
Even if Trump lifts the ban on new LNG projects, there’s a catch: only about 3% more American gas will be available this year. Why? Infrastructure bottlenecks and delays are the main culprits.
Here is the thing, America also has needs, too! A boom in artificial intelligence (AI) could mean more electricity demand, which would eat into those export volumes. It might take until 2026 for the US to significantly ramp up its LNG production. This is a big concern for many.
Meanwhile, Russian gas imports to Europe aren’t dropping consistently. Some EU members haven’t fully backed a complete ban on Russian LNG. Plus, Russia is still selling some gas, as European gas prices have increased by 20% since December. This is driven by the fact that Russia has a strong incentive to sell to Europe, despite the tensions.
A Potential Wildcard: Trump’s Peace Deal
Here is a twist, if Trump pulls off a peace deal between Russia and Ukraine, more Russian gas could flow into Europe. Moscow would welcome this, as increased gas demand from China can’t get it back to its old export levels. Some EU countries might also be tempted by the offer.
Even if a peace deal doesn’t happen, Europe’s shift to the US isn’t a straight line. There are too many uncertainties in the mix.
Key Takeaways
- Europe is trying to move away from Russian gas, but it’s not easy.
- The US is stepping up with LNG, but they face supply issues.
- Internal European politics and the potential for Trump’s peace deals could change the dynamics.
- There’s a potential upside: Europe could get more American gas, which could lower prices.