US President Donald Trump has reaffirmed his intention to impose a 25% border tax, or tariffs, on imports from Canada and Mexico starting on February 1st. However, he noted that a decision regarding including oil in this tariff had not been finalized.
Trump, addressing reporters in the Oval Office, stated that the move is aimed at addressing issues such as undocumented migration, the opioid fentanyl crossing the US borders, and trade imbalances with neighboring countries.
Regarding China, Trump expressed concerns about the influx of fentanyl into the US, hinting at the possibility of imposing tariffs on Chinese goods in response to this issue.
During his election campaign, Trump had threatened tariffs on Chinese goods up to 60%, but delayed immediate action upon returning to office, opting to have his administration further investigate the matter.
The flattening of US imports from China since 2018 has been partly attributed to the escalating tariffs imposed by Trump during his presidency.
In light of Trump's tariff threats, Chinese officials have warned against protectionism, emphasizing a desire for mutually beneficial solutions to trade tensions.
Canada and Mexico have indicated they would retaliate with their own tariffs if the US proceeds with its plans, while also working to address US border concerns.
The imposition of tariffs on Canadian and Mexican oil imports could potentially contradict Trump's pledge to lower living costs, as the cost burden might be passed on to businesses and consumers, affecting prices of various commodities including petrol and groceries.
Tariffs are essentially import taxes on foreign-produced goods, intended to incentivize local consumption and bolster a nation's economy by favoring domestic products over imported ones.
Approximately 40% of the oil processed by US refineries is imported, with the majority originating from Canada.