Canadian Tariff Threat: A Spike in U.S. Fuel Prices Looms

President-elect Donald Trump’s tariff proposal on Canadian imports could raise American fuel prices, analysts warn. Trump's 25% tariff aims to curb drug and migrant influx but won't spare Canadian oil. U.S. refiners, heavily reliant on Canadian crude, face higher costs, potentially hiking retail gasoline prices.

President-elect Donald Trump's proposed tariffs on Canadian oil imports might drive up fuel prices for U.S. consumers, experts cautioned. Trump's 25% tariff is intended to combat cross-border drugs and migration issues, but it will not exempt oil, vital to U.S. refiners.

In the Midwest, where refineries rely heavily on over 4 million barrels per day of Canadian oil, pump prices could soar by 30 cents per gallon or more, analysts suggest. Refiners such as Marathon Petroleum, BP, and Phillips 66 may have to either bear the higher import costs or seek alternative, pricier suppliers.

Energy industry groups argue that such tariffs could threaten the affordability of gasoline, despite Trump's campaign promises of cheaper fuel. The U.S. Energy Information Administration noted a drop in gas prices to $3.04 per gallon, the lowest since 2020, yet potential tariffs might reverse this trend, impacting consumers nationwide, especially in tariff-sensitive states.

(With inputs from agencies.)