Energy: The European Union and the United States and Global Agreements to Secure Critical Mineral Supply Chains

Luis Augusto Medeiros Rutledge

Energy Geopolitics

It is not difficult to understand the concern over critical minerals in terms of security from the perspective of the Trump administration, when we consider that U.S. dependence on imports of critical minerals is enormous. Today, more than 95% of U.S. demand for rare earths comes from foreign (non-American) sources, with more than half of most critical minerals also originating abroad.

The current trend is to see the United States moving toward the direct financing of public-private partnerships (similar to those observed in the broader energy and infrastructure sectors) and the strategic use of divestment agreements.

Since President Trump returned to the White House in January 2025, the emphasis on critical minerals as a national security pressure point has grown exponentially. Several White House and legislative initiatives have been launched to strengthen U.S. economic and national security in this area—driven by the slogans of deregulation, investment, and financing.

The U.S. government is using Direct Government Financing and Public-Private Partnerships (PPPs) to increase the security of critical mineral supplies for American industries. The Department of Energy, the Department of Defense, and other U.S. agencies have been granting direct loans to mining companies.

State investment in mining companies is not uncommon, but the U.S. government is adopting an increasingly sophisticated approach to securing critical mineral supplies. These investment trends are supported by international agreements aligning the United States with historically prominent mining nations, with recent frameworks agreed with Australia and Japan. We are also seeing moves to establish agreements with high-potential exploration nations, such as Kazakhstan.

In February 2026, the Trump administration proposed the creation of a preferential trade zone for critical minerals, open to U.S. allies and partners and intended to protect members from erratic and unpredictable prices in the global market by establishing fair prices for critical minerals at each stage of the production process. The trade zone was announced at an event organized by the U.S. Department of State and attended by representatives from more than 50 countries. Brazil was present but is not expected to join the group.

On the other side of the Atlantic, the European Union (EU) is attempting to pursue its own strategy to address resilience in critical mineral supply chains, mainly through the EU Critical Raw Materials Act. The goal is to implement measures that combine industrial policies and market mechanisms to strengthen investment in the critical minerals sector.

To become operational, several Strategic Projects have an expected total capital investment of €22.5 billion. These projects may benefit from coordinated support from EU Member States and financial institutions to become operational, particularly with regard to access to financing and support in connecting with relevant buyers. They will also benefit from streamlined permitting provisions, ensuring predictability for project developers while protecting environmental, social, and governance standards.

In June 2025, several additional projects in non-EU countries were also recognized as Strategic Projects under the EU Critical Raw Materials Act. The projects were assessed in light of their contribution to the EU’s supply security of strategic raw materials, technical feasibility, sustainable implementation, and whether they are mutually beneficial for the EU and the emerging or developing market countries involved by adding value to them.

Some of these Strategic Projects involve strategic raw materials essential for electric vehicles, batteries, and battery storage, such as lithium, nickel, cobalt, manganese, and graphite. Others include the extraction of rare earth elements, which play a key role in the production of high-performance magnets used in wind turbines or electric motors for renewable energy technologies and e-mobility.

Combined with other EU technological activities involving rare earth processing, these additional Strategic Projects may increase the EU’s security of rare earth supply. Strategic Projects also include copper, used from the power grid to microelectronics, tungsten, and boron, used in the automotive, renewable energy, aerospace, and defense sectors.

For this year, further investments are expected, as the EU has launched its second call for strategic projects under the EU Critical Minerals Act. Europe is constantly looking beyond its borders to diversify its supply chains as much as possible. Negotiations are underway for equity stakes and offtake agreements in Australian lithium and rare earth projects, supported by the European Investment Bank (EIB) and national development banks.

We are witnessing a paradigm shift in resource security. By adopting strategies such as direct investments and strategic offtake agreements, Western governments are reshaping global supply chains for critical minerals. As demand for battery metals and rare earths increases, these strategies will not only determine who controls the raw materials of the future, but also who will lead the transition to clean energy.

From a professional standpoint, this shift signals a new operating environment in which political risk and industrial strategy become as important as price and logistics. Companies can no longer rely solely on market forces.

For investors and operators, success will depend on the ability to secure long-term offtake agreements, meet sustainability standards, and build partnerships that reflect geopolitical priorities.

In summary, resource security is no longer a passive condition, but rather an active and competitive domain where public and private actors converge to shape the future of energy and technology.

Reference

Opening Remarks of the Critical Minerals Ministerial - United States Department of State

Joint Press Statement - 4 February 2026.pdf

Luis Augusto Medeiros Rutledge is a Petroleum Engineer and Energy Geopolitics Analyst. He holds an Executive MBA in Oil and Gas Economics from the Federal University of Rio de Janeiro (UFRJ) and a postgraduate degree in International Relations and Diplomacy from IBMEC. He works as a researcher at UFRJ, is a Consulting Member of the Observatory of the Islamic World of Portugal, a consultant for the Center for Foreign Trade Studies Foundation (FUNCEX), a columnist for the website Mente Mundo Relações Internacionais, and the author of numerous published articles on the energy sector.