Filenews 1 August 2025 - by Ariel Cohen
On Sunday, Donald Trump and Ursula von der Leyen announced the preliminary terms of a trade deal between the United States and the EU from Scotland. A key element of the agreement is the European Union's commitment to buy energy products worth €750 billion from the U.S. within the next three years. The agreement also includes EU commitments of €600 billion in investment by European companies. in various sectors of American industry. In return, the U.S. will impose 15 percent tariffs (cap) on most EU exports, instead of the 30 percent that many feared. The Trump-Leyen announcement averted what they "saw" developing into a trade war as Trump's August 1 deadline for 30 percent tariffs approached.
The energy deal comes after a NATO summit where North Atlantic Alliance member states agreed to a U.S. request to increase defense spending to 5 percent of GDP.
The timing of these two agreements is not accidental. For both the US and the EU, it is not only energy that is at stake. Safety is at stake.
How realistic is the US-EU agreement?
Time will tell to what extent the agreement with Brussels benefits the United States. Its critics argue that the EU has "retreated". But even this "humiliation" will not necessarily stop the "trade war". They also point out that the agreement "jeopardizes rules-based global trade". Hungarian Prime Minister Viktor Orban, a Trump supporter, commented: "It was not a deal that President Donald Trump made with Ursula von der Leyen. It was Donald Trump who ate Ursula von der Leyen for breakfast." A statement that is extremely exaggerated.
Although the deal has been criticized as overly favourable to the U.S., and even though the EU was not negotiating from a position of strength, a "trade war" would be economically disastrous for both sides. Europe's endemic competitiveness problem, due in part to its Berlin-inspired, short-sighted energy policy, combined with overly aggressive statism and internal strife, means that the EU has failed to be flexible enough to exploit loopholes in Trump's tactics or move quickly to forge economic alliances with other major world powers.
Details of the EU's energy purchases have not been made public. Exports of oil, liquefied natural gas and coal from the US to the EU totalled €76 billion. in 2024 and should triple to reach 250 billion dollars. per year as stipulated in the agreement. Although an EU official said the amount reflected the amount of U.S. energy that Europe can absorb, neither side has given detailed information on what else would be included in the deal, such as infrastructure or nuclear exports. The lack of explanations and unclear mechanisms for adhering to the agreement signal that the commitments of the two parties may not be fully implemented.
Strategic dimensions for Europe's energy sector
With the agreement, Europe is not just buying energy, nor is it just hoping to have better terms of trade with the United States. It also buys insurance. The EU is in a weak negotiating position because of the strategically incorrect assessment made by Germany under Angela Merkel. Berlin created a systemic dependence on Gazprom's Russian gas and failed to break free after Russia's invasion of Ukraine in 2014. One factor that has led to the US-EU trade deal and NATO's commitment to increase its defence spending is the war raging in Ukraine.
The EU has been trying to stop Russian energy imports since the start of the war in February 2022. The continuation of the indirect or direct purchase of Russian energy has proven to be an economic lifesaver for Moscow, since it feeds its military operations with these revenues. The EU has made "grandiose" statements about cutting off Russian gas supplies, but it needs to find a firm solution to replenish imports from Moscow. The best-choice (US) market is more in line with the EU's strategic priorities and strengthens the transatlantic alliance with a life span of more than 100 years.
Therefore, the US-EU agreement is an important step towards Europe's gradual de-dependence on Russian energy, which can ensure greater energy security and make a significant contribution to stopping Russia's war machine, hitting the Kremlin in... wallet. The deal also comes at a time when Trump appears more critical of Vladimir Putin over Russian shelling of Ukrainian cities and towns. The announcement of the EU-US trade deal came shortly after the US president recently said he was bringing forward the deadline he had set for reaching a ceasefire agreement in Ukraine from 50 days to 10-12, saying he was disappointed by Putin.
Strategic alignment benefits both Europe and the US
Since Trump's return to the White House, EU members have been in constant conflict with the president. However, its recent tougher stance towards Russia suggests a possible "turn" in favour of Europe's long-term security interests. The American president's frustration with Putin's actions is evident, and Trump now seems willing to put pressure on Moscow and show solidarity with European allies. Although the trade deal seems vague, ambitious, and without clear compliance mechanisms, Europe's concessions could ultimately prove crucial. Tensions with Russia may escalate, and the EU's willingness to accept less favorable economic terms could be the small price it pays for stronger U.S. support in the future.
Europe has significantly increased its defense spending and improved military coordination since the start of the war in Ukraine, but it is still far from being safe or self-sufficient militarily. The recent agreement with the US cannot be considered only from an economic point of view, as energy diplomacy and security issues are interlinked. Europe may have sacrificed its short-term economic influence, but that sacrifice could bring it significant benefits as EU members seek to improve their position in the face of an increasingly aggressive Russia.
