For decades, the United States’ dependence on imported energy served as a natural leash, preventing any administration from going too far in alienating allies or reshaping global power dynamics. But times have changed. Unshackled by energy constraints, the Trump White House now wields America’s booming liquefied natural gas (LNG) industry like a geopolitical cudgel. The second Trump presidency finds itself in a uniquely powerful position, leveraging the country’s status as the world’s top LNG exporter to reshape trade deals, assert dominance, and bulldoze through old alliances with unprecedented abandon.

In just seven years, the U.S. has gone from an insignificant LNG supplier to the top producer, a transformation that, under Trump, has become as much about global leverage as it is about energy policy. The U.S. is set to expand its LNG capacity by 60% by mid-2029, meaning nearly one in three LNG tankers will soon be American-made, making the country’s energy dominance the perfect prop for Trump’s power games.

While his unconventional diplomatic approach—negotiating a peace deal for Ukraine without key allies (or Ukraine itself), slapping tariffs on economic partners, and floating grandiose Middle East ‘reordering’ schemes—has sent shockwaves through global markets, one thing remains stable: demand for U.S. natural gas. Despite their diplomatic misgivings, Europe, India, and Japan are all scrambling to secure additional American LNG shipments, eager to distance themselves from Russian energy reliance while avoiding further economic shocks.

Trump himself frequently boasts about his plans to boost production of what he calls America’s “liquid gold”—shale oil and gas—often taking swipes at his predecessor, Joe Biden, for holding back fossil fuel expansion in the name of climate change. But while crude oil production is set to rise by a mere 2.9% this year, gas is another story. The Permian Basin, America’s largest oil-producing region, is expected to peak by 2028, coinciding with the last full year of Trump’s presidency. Meanwhile, analysts suggest that Trump’s promise to increase U.S. oil output by 3 million barrels per day is more of a creative accounting trick—one that likely factors in LNG production to meet the numbers.

Two decades ago, the idea that natural gas would outshine crude oil in U.S. diplomacy was laughable. At the time, America was an energy beggar, importing vast amounts of LNG. Alan Greenspan called for a rapid expansion of import terminals to avoid an energy crisis. But fracking changed everything. By unlocking vast reserves of previously untapped oil and gas, the U.S. more than doubled its natural gas production, making it the backbone of the nation’s electricity supply—now accounting for 41% of total generation.

The shale boom brought its own problems. Overproduction created a supply glut, sending prices into a decade-long slump that crushed corporate profits. But American energy executives, never ones to let a good crisis go to waste, saw an opportunity: rather than shutting down wells, they built multi-billion-dollar LNG export terminals to ship excess gas overseas, fueling a massive new industry. Today, American LNG is crucial for Europe’s energy security, Asia’s growing economies, and the ever-expanding demands of AI-driven data centres that are hungry for electricity.

Cheniere Energy, Venture Global, and many other companies have rushed to capitalise on this, erecting new LNG terminals along the Gulf Coast that turn gas into supercooled liquid for easy transport. Eight such facilities are currently operational, with three more under construction and several more awaiting final investment decisions. Meanwhile, Trump has revived a long-dormant Alaska LNG project with the intent of further expanding America’s energy reach.

For all of Europe’s talk of energy independence, its actions tell a different story. The EU’s commitment to transitioning away from Russian energy saw it become increasingly reliant on U.S. gas—a move that, ironically, placed European economies at the mercy of Washington’s shifting political winds. While Trump cosies up to Vladimir Putin, the continent remains beholden to American LNG shipments to keep the lights on.

Europe, ever the loyal sidekick to U.S. foreign policy blunders, is now paying the price. After enthusiastically embracing Washington’s anti-Russia stance at the onset of the Ukraine war, EU leaders cut off dialogue with Moscow and happily said goodbye to cheap Russian pipeline gas. In exchange, they got record-high energy prices, factory closures, and a slow but steady deindustrialisation of key economies like Germany. But no worries—the “rules-based order” is still intact.

Meanwhile, as Europe’s economy teeters on the edge, the U.S. is making bank. LNG exports to the continent have skyrocketed, and with them, America’s geopolitical leverage. European leaders stuck between the rock of U.S. tariffs and the hard place of their energy policies now depend entirely on Washington’s goodwill.

Trump’s gas-powered diplomacy might look unstoppable for now, but it’s not without risks.

1. China Retaliates – China, the world’s largest LNG importer, slapped retaliatory tariffs on U.S. gas in response to Trump’s latest trade war antics. Should Beijing escalate, American exporters could find themselves with an oversupply problem—again.
2. Overproduction Woes – The rapid expansion of U.S. LNG capacity could create a glut by the decade’s end, crashing prices and undermining profitability.
3. Energy Transition & Climate Risks – While natural gas has long been considered a “bridge fuel” to a cleaner future, its long-term viability is in doubt. Europe and Asia are investing heavily in renewables, and as storage technology improves, reliance on LNG could diminish faster than many expect.
4. Geopolitical Blowback—Trump’s aggressive energy policy might be winning short-term deals, but it could alienate key partners in the long run. Nobody likes to be strong-armed into buying expensive gas, and as alternative energy sources develop, U.S. leverage could wane.

For now, however, LNG is the gift that keeps on giving for Trump. As he swaggers through global negotiations, emboldened by the knowledge that the world quite literally needs what he’s selling, one thing is clear: America’s energy dominance is reshaping geopolitics in ways no one saw coming. Just don’t expect Europe to wise up anytime soon.