European therefore consumes squash or coffee (8)
I believe the answer is:
espresso
'coffee' is the definition.
(I know that espresso is a type of coffee)
'european therefore consumes squash' is the wordplay.
'european' becomes 'e' (abbreviation e.g. EU).
'therefore' becomes 'so' ('so' can mean 'consequently' or 'therefore').
'consumes' means one lot of letters goes inside another.
'squash' becomes 'press' (I've seen this in other clues).
'so' enclosing 'press' is 'spresso'.
'e'+'spresso'='ESPRESSO'
'or' acts as a link.
(Other definitions for espresso that I've seen before include "Barista's beverage" , "Coffee-making machine" , "Strong black coffee" , "Seep Ross into the coffee" , "Steamed coffee" .)