EU can't guarantee $750B U.S. energy deal hours after Trump pact

The European Union's ambitious pledge to purchase $750 billion in U.S. energy over three years hit immediate roadblocks on Monday, as EU officials admitted they could not guarantee the deal struck just hours earlier with President Donald Trump. The acknowledgment exposes the fragile foundation of the landmark trade agreement, which was heralded as a geopolitical realignment away from Russian energy dependence.

"It is not something that the EU as a public authority can guarantee. It is something which is based on the intentions of the private companies," a senior European Commission official told reporters. The admission came as Brussels clarified that the $600 billion investment commitment would come entirely from private European companies, with no public sector backing.

The deal's structure reveals a fundamental disconnect between political promises and economic reality. European Commission President Ursula von der Leyen's announcement Sunday of $250 billion annual energy purchases relies completely on private sector decisions that Brussels cannot control or direct.

Industry experts have expressed skepticism about the feasibility of the targets. Andreas Schroeder, head of gas analytics at ICIS, called the $250 billion annual target "unrealistic," noting that "the global LNG market has a value of just little over $200 billion at current prices". The EU imported only around $70 billion in energy from the U.S. in 2024, meaning the deal would require tripling current purchase levels.

Market Response Tempered by Reality

Despite initial gains for U.S. LNG producers — with Cheniere Energy rising 3% and Venture Global LNG jumping 4% — market reaction remained muted as traders digested the implementation challenges. European TTF gas prices showed limited movement following the announcement.

The deal emerged from Trump's Scotland meeting with von der Leyen as part of broader trade negotiations that reduced threatened tariffs from 30% to 15% on EU goods. The energy component aims to replace Russian fossil fuel imports, which the EU has pledged to phase out by 2027.

However, energy analyst Anne-Sophie Corbeau noted on LinkedIn that "neither the [European Commission] nor the [White House] can dictate where super flexible U.S. LNG goes", highlighting the market-driven nature of global energy flows that political agreements cannot override.

Implementation Questions Persist

The framework agreement leaves critical details unresolved, with von der Leyen acknowledging that specifics "have to be sorted out and that will happen over the next weeks". The Commission has not announced any incentives to ensure private companies meet the targets, nor provided a precise timeframe for the investments.

Current U.S. LNG exports to the EU total approximately $25 billion annually, representing just 10% of the three-year target at current prices and volumes. Meeting the full commitment would require substantial infrastructure expansion and sustained high energy prices — conditions beyond the control of either government.