President Donald Trump has fundamentally changed global trade. The United Kingdom, European Union, Japan, and many other countries have all signed deals that locked in minimum tariffs on their U.S. exports while greatly reducing their tariffs on American goods. The deals also locked in billions of dollars in investment in the United States.
But a crucial aspect of these deals has gone underappreciated: the centrality of American energy. Although American energy was constrained during the Biden administration, the Trump administration and Republicans in Congress have forced U.S. energy independence front and center. In doing so, they have strengthened relationships with allies and created an energy policy that can help counter China.
Trump’s recent appearance at the Association of Southeast Asian Nations Summit and successive visits to Asian states underline how central American energy has been to the GOP’s agenda. A trade deal with Japan landed $550 billion in investment, with up to $332 billion of that going toward “critical energy infrastructure” in America. Indonesia announced it would begin importing American crude oil, and Malaysia agreed to buy up to $3.4 billion in U.S. liquefied natural gas per year. Not to be outdone, Thailand committed to buying $5.4 billion in American energy on an annual basis. A successive trip to South Korea secured the annual purchase of 3.3 tons of American LNG.
Asia has not been the only bright spot. Trump’s trade deal with the EU, announced earlier this year, saw Brussels agree to invest $750 billion in American energy by 2028.
Congress has also gotten in on the action, primarily via the One Big Beautiful Bill Act, which mandated offshore oil and gas leases, opening up drilling in the Gulf of America. It also brought down the federal royalty rate for offshore gas and oil development to 12.5%, restoring it to where it was before former President Joe Biden’s Inflation Reduction Act increased it to over 16%.
The “big, beautiful” bill also included the Enhancing Energy Recovery Act. Originally a separate bill, the legislation increased 45Q tax credits. While these may not be well-known, they are extremely important for companies in the energy sector, as they provide tax credits for carbon capture. Previous versions of the tax credit were limited to only certain types of companies; the bill eliminated this, allowing for what lawmakers called “across-the-board” access.
But there is more that can be done. The Natural Gas Export Expansion Act, currently pending before the Senate, will make it easier for the U.S. to expedite LNG abroad to any country that is not under sanction. Sponsored by Sens. Ted Cruz (R-TX), Kevin Cramer (R-ND), and Shelley Moore Capito (R-WV), the bill recognizes that LNG will be, going forward, a key tool for the U.S. as it navigates a multipolar world order where Russia, China, and other adversaries are all seeking economic leverage. At the same time, it empowers domestic producers — helping America at home and abroad.
MIKE JOHNSON WARNS DELIVERING ON TRUMP’S AFFORDABILITY AGENDA WILL TAKE ‘A WHILE’: ‘VERY COMPLEX’
Whether the Natural Gas Export Expansion Act is passed via a new reconciliation package or on its own, the Trump administration should throw its weight behind it, and Republicans should use their majority in the House to pass it, thereby giving it momentum in the Senate.
America is a land blessed with a plethora of natural resources, including energy. As we seek to bolster our own people while securing peace and stability abroad, we should use these resources to our advantage.
