US President-elect Donald Trump on Friday threatened the European Union, demanding to reduce its trade gap with America through oil and gas purchases or face tariffs.
“I told the European Union that they must make up their tremendous deficit with the United States by the large scale purchase of our oil and gas. Otherwise, it is TARIFFS all the way,” Trump wrote on Truth Social early morning.
The trade deficit between the US and EU stood at $131.3 billion in 2022, according to American data.
Ready to discuss with US: EU responds
European Commission Spokesperson Olof Gill responded to CNBC, stating: “The EU and U.S. have deeply integrated economies, with overall balanced trade and investment. We are ready to discuss with President-elect Trump how we can further strengthen an already strong relationship, including by discussing our common interests in the energy sector.”
Gill further noted the EU’s commitment to ending Russian energy imports and diversifying supply sources.
A senior EU diplomat, speaking anonymously, told CNBC they anticipated Trump’s statement and considered energy a viable option for increasing US imports.
Another unnamed EU official confirmed to CNBC that German Chancellor Olaf Scholz had communicated with Trump the previous evening.
The EU sends nearly one-fifth of its exports to the US, its largest recipient. The primary trade deficit lies in machinery and vehicles, reaching 102 billion euros in 2023. However, the US maintains a 70 billion euro surplus in energy trade and a substantial surplus in services.
The US leads global oil production, contributing 22% of worldwide supply in 2023. The EIA forecasts record crude production in 2024, with producers expecting increased output under Trump’s anticipated deregulation.
The EU has previously indicated plans to increase US energy purchases. In January, European Commission President Ursula von der Leyen discussed replacing Russian LNG with more cost-effective US supplies, expressing interest in negotiations upon Trump’s 2025 inauguration.
On Friday morning, European markets declined whilst the euro rose 0.2% against the dollar to $1.038.
