EU strikes major deal to purchase $750 billion in US energy resources

On July 28, 2025, major stock markets in Europe are expected to rise following the agreement of a significant trade deal between the United States and the European Union. This agreement has been announced during a press conference at President Donald Trump's Turnberry golf resort in Ayrshire, and is described as a breakthrough by Ursula von der Leyen, the president of the European Commission. The deal comes as both sides seek to alleviate ongoing tensions regarding trade tariffs that have been a point of contention for years. According to the terms of the agreement, several changes will affect various sectors, including the automotive and pharmaceutical industries. EU exports will now carry a flat 15 percent tariff, although some tariffs on pharmaceuticals and semiconductors might be reassessed in the near future. Furthermore, a zero-for-zero tariff arrangement has been established for a range of critical goods, such as aircraft parts and certain agricultural products, allowing for greater trade freedom between the two regions. Additionally, tariffs on steel and aluminum will be transitioned to a quota system to better manage global overcapacity. As part of the deal, the EU has committed to purchasing $750 billion worth of US oil and liquefied natural gas. This move is intended to reduce the EU's dependency on Russian energy sources, reinforcing energy security in the region. Trump has highlighted this deal as a great victory, claiming that it represents the largest trade agreement ever negotiated. Economists have provided varied interpretations of the agreement, with some suggesting it is beneficial for equity markets but not a complete resolution to pre-existing trade tensions. Concerns persist about unresolved trade negotiations with other countries, such as Canada, emphasizing the ongoing complexities within international trade relations.