I think his hubris makes him overestimate Cloudflare's importance for Europe. Cloudflare is simply not important enough. If it was Microsoft or Apple threatening, then maybe - but those companies are clever enough to leverage lobbying for this.
Now the Cloudflare CEO has set himself up to be at the whims of JD Vance/Trump, while providing a perfect "arrogant US tech company" scapegoat that can be slaugthered by European politics and the media conglomerate that he is threatening.
Europe is too important for USA. I don't think the US administration will like the relationship to go sour at this very point in time just because of this Cloudflare doofus barking around.
Anyways, it is like Facebook CEO and Amazon CEO applauding the Trump inauguration; it is a totally unnecessary political statement which fragments their userbase and introduces a political dimension to any procurement decision involving Cloudflare. It takes people's illusion that Cloudflare is a neutral tech company and replaces it with this guy's twitter ramblings, who is obviously an Elon Musk and JD Vance fanboy.