In Canada’s oil-rich state of Alberta, there is widespread concern over President-elect Donald Trump’s promise to put a 25% tariff on Canadian exports. Canadian lawmakers and energy experts say that the high tariff will harm America’s northern neighbour’s economy and raise prices for US customers. “Canada has no choice in this,” Dennis McConaghy, a former oil executive from Alberta, told the BBC. “It has to find an accommodation with Trump.” Trump declared on Monday that, upon assuming office in January, he would impose an all-encompassing tariff on Mexico and Canada, with no mention of excluding oil and gas. Lisa Baiton, president and CEO of the Calgary-based Canadian Association of Petroleum Producers, stated that the levy will likely mean Canada is generating less oil. Mr McConaghy stated that this would result in job losses in Alberta, potentially affecting Canada as a whole, because weaker provinces rely on cash transfers from wealthier provinces, such as Alberta, to help balance expenses and provide social services.

It might also lead to a devaluation of the Canadian dollar, which is already under pressure from internal economic considerations, he warned. “Keep in mind that almost 80% of Canada’s trade is with the United States, with the majority of that trade being in hydrocarbons. Canadians cannot avoid their integration with the United States.” US fuel producers have also encouraged Trump to exclude oil and gas from any planned charges, citing Americans’ reliance on imported Canadian crude. “Crude oil is to refineries what flour is to bakeries,” the American Fuel and Petrochemical Manufacturers (AFPM) business organization stated this week. “It’s our primary feedstock and input expense. If those feedstocks grow considerably “It’s our number one feedstock and input cost. If those feedstocks were to become significantly more expensive, so too would the overall cost of making fuel here in the United States.”

Trump’s tariff threat has spooked Canada’s oil patch Ten hours ago. Nadine Yousif BBC News, Toronto. Share Save Getty Images Suncor Energy’s oil refinery in Edmonton, Alberta, Canada, was photographed on Wednesday, April 5, 2023. Getty Images Analysts warn Trump’s promised tariffs on oil could hike costs at the pump in the United States and harm the Canadian economy. In Canada’s oil-rich state of Alberta, there is widespread concern over President-elect Donald Trump’s promise to put a 25% tariff on Canadian exports. Canadian lawmakers and energy experts say that the high tariff will harm America’s northern neighbour’s economy and raise prices for US customers. “Canada has no choice in this,” Dennis McConaghy, an Alberta-based Canadian oil is especially important in the landlocked Midwest, where refineries have been equipped to handle the heavier Canadian mixes. The AFPM stated that there is no easy replacement for that crude without relying on foreign supplies, which might jeopardize US energy security. The business association warned that a levy on Canadian oil will increase operational expenses in the Midwest, which some experts believe will be passed on to consumers. Patrick De Haan, a Chicago-based gas price expert, said that gas prices in states such as Minnesota, Wisconsin, and Michigan might rise by up to 75 cents per gallon.

Patrick De Haan, a Chicago-based gas price expert, said that gas prices in states such as Minnesota, Wisconsin, and Michigan might rise by up to 75 cents per gallon. Mr De Haan stated in a post on X, formerly Twitter, that these higher prices would not just affect gas stations, but might also raise expenses for airlines and freight companies. An increase in oil prices for US consumers would contradict Trump’s vow to lower energy costs. On the campaign trail, Trump regularly stated that he aimed to reduce gasoline prices to less than $2 (£1.57) per gallon. As of late November, normal gasoline in the United States cost roughly $3 per gallon.

Trump’s tariff threat has spooked Canada’s oil patch Ten hours ago. Nadine Yousif BBC News, Toronto. Share Save Getty Images Suncor Energy’s oil refinery in Edmonton, Alberta, Canada, was photographed on Wednesday, April 5, 2023. Getty Images Analysts warn Trump’s promised tariffs on oil could hike costs at the pump in the United States and harm the Canadian economy. In Canada’s oil-rich state of Alberta, there is widespread concern over President-elect Donald Trump’s promise to put a 25% tariff on Canadian exports. Canadian lawmakers and energy experts say that the high tariff will harm America’s northern neighbour’s economy and raise prices for US customers. “Canada has no choice in this,” Dennis McConaghy, an Alberta-based ,In this situation, Trump could be using tariffs to pressure Canada and Mexico to cooperate on border security. Trump has indicated that the tariffs will remain in place until both Canada and Mexico strive to secure their common borders with the United States, reducing the number of illegal migrants and drugs entering the nation.

Prime Minister Justin Trudeau has promised to present a united “Team Canada” face and cooperate with the incoming Trump administration to prevent blanket tariffs. Leaders from major Canadian provinces such as Ontario, Quebec, and Alberta have asked Trudeau to act quickly on these demands, and on Wednesday, Trudeau held an emergency conference with provincial and territorial leaders to decide how to proceed. Danielle Smith, Alberta’s premier, stated that her province will be “working aggressively” in the coming months to meet with US counterparts and reinforce the idea that a strong alliance with Canada will help the US and its energy security. She stated that in her opinion, Trump “and the tens of millions of Americans who voted for him have valid concerns” related border security.