ASX 200 lithium shares could be winners as Biden calls critical clean energy metals the 'third pillar of the Australia-US alliance'

S&P/ASX 200 Index (ASX: XJO) lithium shares have enjoyed a strong rebound since lithium prices bottomed on 24 April.

Lithium stocks, big and small, came under pressure late in November when prices began to nosedive from all-time highs, tumbling more than 70% before finding support.

Prices for the battery-critical metal have since leapt around 25%, helping lift the fortunes of the lithium miners.

And most of the top lithium miners have continued to outperform over the past month.

Here's how these five leading ASX 200 lithium shares have performed since 24 April (as at market close on Friday):

• Pilbara Minerals Ltd (ASX: PLS) shares are 18%
• Core Lithium Ltd (ASX: CXO) shares are up 15%
• Allkem Ltd (ASX: AKE) shares are up 33%
• IGO Ltd (ASX: IGO) shares are up 7%
• Liontown Resources Ltd (ASX: LTR) shares are up 3%

In early morning trade today, all of the above ASX 200 lithium shares are in the red.

Yet despite this morning's slip, the medium and longer-term outlook for the critical metal miners got another healthy boost over the weekend, courtesy of United States President Joe Biden.

How might the US help lift ASX 200 lithium shares?

On Saturday, Biden attended the Quadrilateral Security Dialogue (Quad) summit in Hiroshima.

Following on the heels of the G7 summit earlier in the day, Biden met with prime minister Anthony Albanese to discuss a range of issues. These included the need for Western nations to diversify their supply chains of critical clean energy metals.

This is encompassed under the Australia-US Climate, Critical Minerals and Clean Energy Transformation Compact, which runs parallel with the US$369 billion (AU$555 billion) Inflation Reduction Act (IRA).

In a sound bite that should pique the interest of investors in ASX 200 lithium shares, Biden said (quoted by The Australian Financial Review):

We are going to establish climate and energy as the third pillar of the Australia-US alliance. This will enable the expansion and diversification of clean energy supply chains, especially as it relates to critical materials.

Together, the leaders added that Biden will seek to have Australia added as a "domestic source" under the US Defense Production Act. Atop other potential advantages for ASX 200 lithium shares, this would open the door to new US investments in their projects.

Why is Biden eager to tap into Australia's critical minerals?

China has long dominated the supply chain of a range of metals crucial for technology and the world's push towards electrification, such as rare earth elements and lithium, which has potential national security ramifications.

And ASX 200 lithium shares look to be among the beneficiaries of the US push to diminish China's dominance.

While Australia has the fifth-largest lithium reserves on the planet, it is currently the world's biggest lithium producer.

And while there are sure to be numerous ups and downs along the way, that leaves ASX 200 lithium shares well-positioned to take advantage over the medium and longer term of this new "third pillar" of Australia's alliance with the world's top economy.