Oil Surges as Trump Tariff Plans Usher in Start of Trade Wars

Oil prices have surged in recent days as President Donald Trump's tariff plans have raised concerns about potential disruptions in global energy markets. The proposed tariffs on imports from Canada, Mexico, and China have sparked fears of a full-blown trade war, which could have significant implications for the oil and gas industry.

The U.S. imports a significant amount of oil and gas from Canada, with about 4 million barrels per day coming from our northern neighbor. A 10% tariff on Canadian energy products, as proposed by Trump, will limit the impact on gasoline prices but will still contribute to an increase. Tom Kloza, global head of energy analysis for OPIS, stated that the impact will be greater if the tariffs stay in place through the summer. The states most likely to be affected are in the Midwest, where most Canadian oil is shipped to refineries via pipeline (Kloza, 2025).

The U.S. also imports a substantial amount of oil from Mexico, with over 450,000 barrels per day coming from our southern neighbor. A 25% tariff on Mexican energy imports will likely lead to higher fuel prices, as refiners may need to find alternative sources of crude, potentially driving up prices (Reuters, 2025).

The tariffs on Canadian and Mexican oil could initially raise gasoline prices in the U.S., particularly in the Midwest, and weigh on crude prices globally due to weaker demand (Goldman Sachs, 2025). The inclusion of Canadian oil in a 25% tariff on Canada and Mexico would likely raise gasoline prices in the U.S. Midwest and eventually weigh on crude prices globally (Bloomberg, 2025).

The long-term imposition of tariffs on critical fuels for the U.S. economy could undermine national security, weaken business dynamism, and reduce the number of markets U.S. companies can compete in and profit (Forbes, 2025). The tariffs could disrupt flows across North America's tightly integrated energy market, with potential reverberations across the global oil market (Bloomberg, 2025).

The strategic implications of Trump's tariff plans for the U.S. and its trading partners are significant. The tariffs could disrupt supply chains, raise prices for American families, and potentially undermine national security. The tariffs may also influence future negotiations and trade agreements, as countries may be more hesitant to engage in trade talks with the U.S. if they fear similar tariff actions in the future (CNN, 2025).

In conclusion, Trump's tariff plans have sparked a surge in oil prices as concerns about potential disruptions in global energy markets grow. The proposed tariffs on imports from Canada, Mexico, and China could have significant implications for the oil and gas industry, with potential long-term effects on global crude oil prices. The strategic implications of these tariffs are substantial, and they may influence future negotiations and trade agreements between the U.S. and its trading partners.