Ottawa should guarantee Trump understands significance of Canadian oil to US, minister says

By Nia Williams

(Reuters) -Ottawa should be certain the Trump administration understands how inter-related vitality markets are within the U.S. and Canada, a Canadian authorities minister mentioned on Thursday, commenting on President-elect Donald Trump’s vow to impose a 25% tariff on imports from the nation.

“We’ve got some work to do to verify we’re successfully articulating the best way through which tariffs could be counterproductive, and that is not simply true of oil,” Pure Sources Minister Jonathan Wilkinson advised Reuters in a telephone interview, including that People additionally benefited from Canadian uranium and hydro exports.

Trump, who takes workplace on Jan. 20, mentioned on Monday he would impose a 25% tariff on imports from Canada and Mexico till they clamped down on medicine and migrants crossing the border.

Canada is the world’s fourth-largest oil producer and the overwhelming majority of its crude exports go to the USA.

Sources advised Reuters Trump doesn’t intend to exempt crude from the tariffs, despite the fact that the U.S. imports round 4 million barrels per day from north of its border and plenty of Midwestern refineries are set as much as run Canada’s heavy bitter crude.

Analysts say tariffs on oil from Canada, prime crude provider to the USA, would drive up gasoline costs for People.

“There’s quite a lot of effort and time that might want to go into guaranteeing that we’re having the suitable conversations,” Wilkinson mentioned.

“We’ve got a few months earlier than the president is inaugurated and I feel there’s time for some strong conversations between international locations which can be truly finest pals and have each been benefiting vastly from an financial perspective due to the commerce that goes between us, notably in vitality.”

Earlier this yr the growth of the Trans Mountain pipeline, operating from Alberta’s oil sands area to Canada’s Pacific Coast, elevated entry to Asian markets however the pipeline is already operating round 80% full and has restricted capability to ship extra oil that path.