Under the 15-month extension, the United States will refrain from its tariffs of 25% on EU steel and 10% on EU aluminium imposed in 2018 by former President Donald Trump, so parking the dispute until after U.S. and EU elections.
EU tariffs, imposed in retaliation, covered a range of U.S. goods from Harley Davidson motorcycles to bourbon whiskey and power boats.
Washington replaced its tariffs with quotas from January 2022, initially for a period of two years.
The two sides were supposed to agree on measures to tackle overcapacity before the end of 2023, but negotiations stalled ahead of a U.S-EU summit in October.
Washington has since offered to extend the tariff suspension to allow more time for talks on creating a system to counter overcapacity and promote less carbon-intensive steel-making.
European steel association Eurofer said it viewed the extension as positive and said it cleared the way for a resumption of negotiations.
The U.S. Distilled Spirits Council said it greatly appreciated the extension and that it had averted a reimposition and doubling of the EU tariff to 50% in the new year. It called for a permanent end to the dispute.
The U.S. quota system allows up to 3.3 million metric tons of EU steel and 384,000 tons of aluminium into the United States tariff-free, reflecting past trade levels, with further amounts subject to tariffs.
The European Commission has complained the system is rigid and meant EU steel was subject to some $264 million of U.S. tariffs last year, while the EU simply removed its retaliatory tariffs.
(Reporting by Philip Blenkinsop; Editing by Jacqueline Wong, Clarence Fernandez and David Evans)
By Philip Blenkinsop
