US President Donald Trump announced that he is set to impose tariffs of 25% on Mexico, 25% on Canada, and 10% on China, according to a statement from the White House.
However, Trump mentioned on Friday that the tariffs on Canadian oil would be lower, standing at 10%, and potentially taking effect on February 18.
In addition, he expressed intentions to levy tariffs on the European Union in response to what he claimed was the bloc's unfavorable treatment of the US.
The White House press secretary, Karoline Leavitt, attributed the tariffs on Canada and Mexico to their involvement in the distribution of illegal fentanyl into the US, resulting in the deaths of many Americans.
Trump repeatedly linked the tariffs to addressing the issues of undocumented migration across US borders and trade imbalances with neighboring countries.
Leavitt underscored at a White House news briefing that these actions fulfill "promises made and promises kept by the President."
Trump had previously threatened higher tariffs on Chinese products during his election campaign, but delayed immediate action upon returning to the White House, opting to study the issue first.
The imposition of escalating tariffs by Trump during his first term has affected US imports from China, and economists partly attribute the flattened import volume to these measures.
Recent warnings against protectionism and calls for a "win-win" solution to trade tensions have been issued by top Chinese officials, hinting at the potential for a renewed trade war between the US and China.
Amid concerns over the repercussions of steep tariffs on trade and consumer prices, reactions from Canada, Mexico, and China point towards retaliatory measures being considered.
Tariffs, characterized as import taxes on foreign goods, are designed to deter their purchase, promote domestic products, and stimulate a country's economy, yet they can also lead to price hikes for consumers.
The implications of levies on imported energy sources, especially oil from Canada and Mexico, could impact Trump's efforts to reduce living costs and potentially result in economic disruptions in the near term.
Acknowledging the potential impact on economic growth and inflation, Mark Carney, former head of central banks in Canada and England, warned that such tariffs could harm the US's global standing and influence.