Trump’s ‘energy dominance’ strategy starting to crack Eastern European markets
Such shipments hold significance in a variety of ways, and offer a possible window into the Trump administration’s desire to use energy trade to offset the aggressive geopolitical behavior of Russian President Vladimir Putin. In March, Ukraine cut off deliveries of coal from the Russian-controlled region of Donbass, where much of Ukraine’s coal industry resided before the 2014 conflict between Ukraine and Russia began.
Centrenergo, the Ukrainian power utility, has been struggling since March to replace the blocked coal supplies. Now, Latrobe, Pennsylvania-based XCoal Energy will send 700,000 tons of anthracite coal to Odessa over the next several months. The agreement follows a June meeting between President Donald Trump and Ukrainian President Petro Poroshenko and U.S. President Donald Trump.
This week also marks the first shipment of liquefied natural gas from the United States to the Baltic state of Lithuania, a former Soviet satellite, which until recently was completely dependent on Russian gas supplies. Lithuania and the other Baltic states of Latvia and Estonia have at times been under withering political pressure from their former Cold War patrons, particularly since Moscow occupied the Crimea in 2014.
Trump’s visit to Poland in early July included a speech that highlighted his administration’s desire to exert a counter-force on Russia through the energy markets, “so that you can never be held hostage to a single supplier,” Trump said.
Poland received its first U.S.-based shipment of LNG in July, and the single U.S. LNG export terminal at Sabine Pass on the Texas-Louisiana border has sent out more than 160 cargoes since starting up in February. Several of the cargoes have reached Spain, Italy, the United Kingdom and the Netherlands in the past 18 months.
U.S. LNG export capacity is set to grow five-fold by 2020, potentially making Eastern European economies awash in natural gas, just as many of the long-term delivery contracts signed between Eastern Europe and Russia’s natural gas monopoly Gazprom are set to expire in the early 2020s.
Image by Anatoly Menzhiliy