EU Eyes Quick Trade Deal with U.S. as Tariff Deadline Looms

European Union leaders are leaning toward a swift trade agreement with the United States, despite the likelihood of accepting Washington’s tougher terms. With a July 9 deadline set by President Donald Trump, EU leaders meeting in Brussels on Thursday will guide the European Commission on whether to prioritize a fast resolution or risk prolonged negotiations that could worsen the trade standoff.

Most EU diplomats and officials favor a quick deal to prevent an escalation of U.S. tariffs, already hitting EU steel, aluminum, and autos with rates as high as 50%. German Chancellor Friedrich Merz emphasized the importance of avoiding a deeper conflict, saying in parliament that he hopes for a solution by early July.

The U.S. currently imposes a flat 10% tariff on most EU goods, a rate it has applied even in its only finalized deal with Britain. EU leaders are now weighing whether to implement rebalancing measures in response. Although the EU has approved tariffs on €21 billion worth of U.S. goods, further measures targeting up to €95 billion remain under debate. Some member states, however, are pushing to scale them down.

One significant option includes a digital advertising tax aimed at U.S. tech giants like Google, Meta, Apple, and Microsoft—potentially reducing the U.S. services trade surplus with the EU. Meanwhile, the European Commission has proposed cutting tariffs on industrial goods to zero and increasing EU purchases of U.S. LNG and soybeans, though Washington remains focused on regulatory barriers.

Separately, EU leaders will address concerns from Slovakia and Hungary over ending Russian gas imports, a key step in unblocking the EU’s 18th sanctions package against Russia. However, a proposed cut to the Russian oil price cap may be dropped due to opposition from Greece, Malta, and Cyprus.