U.S. President Donald Trump said he would likely decide by the end of the day Thursday whether to put a 25 per cent tariff on Canadian oil imports that would take effect on Saturday.
“We may or may not. We’re going to make that determination probably tonight on oil,” Trump told reporters at the White House.
“We’ll see. It depends on what the price is. If the oil is properly priced, if they treat us properly – which they don’t.”
That comment came moments after he said “oil is going to have nothing to do with it as far as I’m concerned” when asked if energy imports from Canada will be exempt from 25 per cent tariffs he plans to impose on all goods from Canada and Mexico.
Trump has repeatedly warned Mexico and Canada – two of the United States’ top trading partners – he will impose tariffs if the two countries do not end shipments of fentanyl and the flow of migrants across U.S. borders.
“We’ll be announcing the tariffs on Canada and Mexico for a number of reasons,” Trump said.
“Number one is the people that have poured into our country — so horrible and so much — number two are the drugs, fentanyl and everything else that have come into the country. Number three are the massive subsidies that we’re giving to Canada and to Mexico in the form of deficits. And I’ll be putting the tariff of 25 per cent on Canada and separately 25 per cent on Mexico. And we will really have to do that because we have very big deficits with those countries.
“Those tariffs may or may not raise with time,” Trump added.
The office of Canadian Prime Minister Justin Trudeau was not immediately available for comment. Mexico’s economy ministry did not immediately respond to a request for comment.
Trump repeatedly complains about the U.S. trade deficit with Canada, which is mainly due to cheap Canadian crude oil exports that many American refineries rely on. Economists and government officials say the U.S. actually has a trade surplus with Canada if those energy exports are removed from trade calculations.
Get breaking National news
Canadian officials and businesses have been scrambling to prepare for the prospect of steep tariffs that economists say could trigger a recession, while also pushing the Trump administration and U.S. lawmakers on a diplomatic solution to prevent them altogether.
The federal government and the country’s premiers have said they have multiple potential responses ready to implement in the event Trump follows through on his tariff threat. Officials have said retaliatory tariffs on U.S. goods are a possibility.
While officials also floated the idea of cutting off energy exports as a retaliatory measure, that proposal has been fiercely opposed by Alberta Premier Danielle Smith, and federal ministers have since insisted that any response will not disproportionately impact specific provinces or regions of the country.
Foreign Affairs Minister Melanie Joly traveled to Washington on Wednesday and said she intended to spend the rest of the week in the capital to keep making Canada’s case. Public Safety Minister David McGuinty and Immigration Minister Marc Miller are also headed to D.C. this week.
Officials have pitched their American counterparts on increasing the trade and energy partnerships between the two countries.
Meanwhile, they and business groups have made the argument that tariffs on Canadian goods will raise prices for consumers on both sides of the border.
“President Trump’s tariffs will tax America first,” the Canadian Chamber of Commerce said in a statement after Trump’s latest comments.
“From higher costs at the pumps, grocery stores and online checkout, tariffs cascade through the economy and end up hurting consumers and businesses on both sides of the border. This is a lose-lose. We will keep working with partners to show President Trump and Americans that this doesn’t make life any more affordable. It makes life more expensive and sends our integrated businesses scrambling.”
The Bank of Canada released an analysis Wednesday that found universal tariffs on foreign imports to the U.S. “increase the prices U.S. consumers pay for imported goods, leading to higher inflation.”
For Canada, meanwhile, it said as demand lowers for Canadian goods due to higher prices, investments, jobs and GDP will decline while inflation “generally rises.”
Trump’s comments came a day after his nominee for U.S. commerce secretary Howard Lutnick, who would oversee Trump’s tariff agenda if confirmed, said Canada and Mexico can avoid the 25 per cent tariffs if they “shut their borders” to fentanyl.
McGuinty and Joly suggested Lutnick’s comments showed a path forward for Canada and expressed confidence that the government’s latest investments in border security and combatting fentanyl would convince Trump to back off.
Finance Minister Dominic LeBlanc’s office said Thursday he sent a video of Canada’s border security efforts to Lutnick after the commerce nominee’s comments at his U.S. Senate confirmation hearing.
Joly told reporters late Wednesday after meeting with U.S. Secretary of State Marco Rubio that she was confident Canada’s arguments were “resonating,” but acknowledged Trump would have the final say.
“We need to continue to engage,” Joly said, but noted “the ultimate decision-maker is President Trump.”
—With files from Reuters