Who gets stuck with the bill for tariffs on imported Canadian oil?
Canadian Minister of Energy and Natural Resources Jonathan Wilkinson discusses the possible impact of tariffs, energy exports, US-Canadian energy bloc and the upcoming Canada elections.
President Donald Trump Tariffs on Canadian oil can come into force in the coming weeks, which will cost and create a new financial burden, Canadian manufacturers, as well as American recycling and consumers.
February 1 announced 25% tariffs on imports from Canada and Mexico, a lower 10% tariff Canadian energy Products: They were originally planned to come into force on February 4, although he delayed them to come into force until March 4.
The analysis of S & P Global found out that “the financial burden of these tariffs will share US recyclers (and after all, US consumers) and Canadian manufacturers.”
“Anything that is interesting about the Canadian production and US recycling business is that they are quite tense,” said Karin Dehi-Kilay, the director of World Ratings of S & Mr c. He explained that this is especially true in “Midwest and Rockies regions where the recyclists use a lot of canada.”
Canadian producers will store the cost of 10% of the possible 10% tariffs for American recycling and consumers, S & P Global Follow. (Mario Tama / Getty Images / Getty Images)
According to the Energy Department, US recycling capacity is about 18.4 million barrels per day, while the result of oil oil oil is about 13.3 million barrels. Canada Oil exportwhich dominate the rough mixture, play an important role in filling out that invalid to keep us exercise.
“The type of Kirada, which Canada produces and sends us to the United States, is mainly this heavy sour source, which the United States does not produce so much,” Dehie-Kili explained. “The heavy ship has been used by quite complicated recyclers in the United States for a long time, and they are very complicated processing factories, it is actually very economical.”
Trump tariff threats can affect Canada oil on three regions of USA, says gas analyst
US oil production is about 5 million barrels below US recycling factories, creating a need to import in capacity. (George Rose / Getty Images / Getty Images)
The tariffs pay import companies, which in this case means US recycling factories. Importers determine that several or all costs of tariffs on consumers to pass or hold Consumer prices Stable but tariff value comes out of corporate bottom line. In some cases, exporters can reduce their prices to help the importer better.
S & P Global Report notes that Canada has limited processing capacity to develop most of its crude oil production and has limited alternatives to export Europe or Asia. Trump’s executive order only spread tariffs for goods imported for consumptionSo some of that oil could be re-registered after entering the United States without refining in the country.
“There is not many options Canister exported outside the United States. There is an TMX pipeline that has come online and has some capacity to the West Coast. It is very rude or California or Asia now.
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If the tariffs enter into force, the export of oil in Canada may be re-exported than in America. (Reuters / Bing Guan / Reuters Photos)
Whereas there is uncertainty when or if Canadian oil tariffs It will effectively affect that most likely to be delayed in a time before producers and higher costs of recycling are translated at higher pump prices.
“I imagine that the manufacturers will return to their prices for some time until their prices, but it is difficult to say how long it will take,” he said.
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“The details are going to see how it will play.
Reuters contributed to this report.
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