According to reports, US President elect Trump has stated that he will impose a 25% tariff on goods imported from Canada after taking office, citing the reason that immigrants enter the United States through Canada.

According to industry experts, fuel prices may rise after President elect Trump fulfills his tariff threat to Canada.

Trump promised on Monday to impose additional tariffs on Canada and Mexico on his first day as president. Trump stated that he will sign an executive order on January 20th imposing a 25% tariff on all imported products from Canada and Mexico, which may violate the terms of regional free trade agreements.

Daan Struyven, co head of global commodity research at Goldman Sachs, said that if a 25% tariff is imposed on Canada's crude oil exports to the United States, "theoretically, this could have quite serious consequences for three groups

Struyven speculates that American refineries relying on Canadian oil barrels may face lower profit margins, while consumers may face higher prices. Finally, if Canadian producers are unable to change the route of the oil barrels originally shipped to the United States, they may suffer revenue losses.

The latest data from the US Energy Information Administration shows that after the expansion of the Trans Mountain Pipeline in Canada, the US imported a record high of 4.3 million barrels per day of Canadian crude oil in July 2024.

In addition, Struyven told reporters in an online conference that refineries in the Midwest are more suitable for processing heavy, high sulfur crude oil from Canada rather than domestically produced low sulfur crude oil. If Canada's imports are interrupted, refineries in the Midwest may also encounter conversion issues.

Struyven said, "If the United States imposes a 25% tariff on Canadian energy exports, I think it could have some very significant impacts on trade flows

Citigroup wrote that Mexico, especially Canada, has "significant close ties" with the United States in the oil, gas, and automotive industries. If not divested, this will increase costs for American refineries and American consumers.

However, Goldman Sachs emphasized that tariffs are unlikely to be implemented as announced, given the Trump administration's focus on reducing energy costs.

Macquarie Capital's global strategist Viktor Shvets said that Trump cannot let inflation spiral out of control in the 15 months leading up to the midterm election season. Shvets believes that tariffs are used as a negotiating tool to achieve certain goals, such as strengthening borders.

Shvets said, "I have no confidence that overall tariffs will increase significantly because it would mean taxing domestic manufacturers in the United States. It would also mean taxing American exporters.