debut: 2/16/17
38,725 runs
Tariffs will lift US gas prices within days
The tariff on products imported from Canada will cost Americans 15 cents a gallon or more at the gas pump relatively soon.One factor limiting the price increase is the tariffs on energy products is only 10%, not the 25% tariff announced on other products from Canada. A Trump administration official told reporters on Saturday that a lower tariff on energy was done to spare Americans from from having to pay even more for gasoline and heating oil, even though President Donald Trump has long insisted, incorrectly, that it is the foreign nation, not Americans, who pay the cost of any tariffs that are imposed.“We took this step simply because… a 10% rate on energy will minimize any disruptive effects we might have on gasoline and home heating oil prices,” said the administration official, who spoke on condition he not be identified.
Wholesale gasoline prices were up 8 cents a gallon on trading markets early Monday.Diesel prices were trading up 10 cents a gallon. Higher prices for diesel could lead to a fuel surcharge by trucking companies, which could bleed through to the price of goods, since virtually every item in Americans’ homes were on a truck at some point. And it could also raise the price of heating oil, which is the same basic product as diesel fuel.
Market prices for wholesale gasoline are up because traders are expecting some of the crude oil and gasoline now being imported from both Canada and Mexico will end up being diverted to other markets, causing some shortages in the United States. Oil futures are up 2% to 3% in Monday morning trading. One reason that they’re not up more is that futures contracts are for purchases of oil to be made in the next few months, and some investors are betting that the tariffs will end up being short-lived.
Since Canada is the largest source of imported oil and gasoline into the US market, it’s been getting much of the attention. But Mexico is also a major exporter of both oil and gasoline to the United States.The impact will not be felt equally nationwide, because most Canadian oil is shipped to Midwest refineries via pipeline, Kloza said. The states served by those refineries are Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, Montana, Nebraska, Ohio, North Dakota, South Dakota, Pennsylvania and Wisconsin.“Interestingly, 12 of those 16 states begin February with an average retail gasoline price under $3 a gallon,” he said. “That probably won’t last.”
New England gets a lot of gasoline from a refinery run by Irving Oil in Saint John, New Brunswick. That also can be shipped elsewhere, so the diversion of that gasoline could send gas prices in New England up 20 cents a gallon
The tariff on products imported from Canada will cost Americans 15 cents a gallon or more at the gas pump relatively soon.One factor limiting the price increase is the tariffs on energy products is only 10%, not the 25% tariff announced on other products from Canada. A Trump administration official told reporters on Saturday that a lower tariff on energy was done to spare Americans from from having to pay even more for gasoline and heating oil, even though President Donald Trump has long insisted, incorrectly, that it is the foreign nation, not Americans, who pay the cost of any tariffs that are imposed.“We took this step simply because… a 10% rate on energy will minimize any disruptive effects we might have on gasoline and home heating oil prices,” said the administration official, who spoke on condition he not be identified.
Wholesale gasoline prices were up 8 cents a gallon on trading markets early Monday.Diesel prices were trading up 10 cents a gallon. Higher prices for diesel could lead to a fuel surcharge by trucking companies, which could bleed through to the price of goods, since virtually every item in Americans’ homes were on a truck at some point. And it could also raise the price of heating oil, which is the same basic product as diesel fuel.
Market prices for wholesale gasoline are up because traders are expecting some of the crude oil and gasoline now being imported from both Canada and Mexico will end up being diverted to other markets, causing some shortages in the United States. Oil futures are up 2% to 3% in Monday morning trading. One reason that they’re not up more is that futures contracts are for purchases of oil to be made in the next few months, and some investors are betting that the tariffs will end up being short-lived.
Since Canada is the largest source of imported oil and gasoline into the US market, it’s been getting much of the attention. But Mexico is also a major exporter of both oil and gasoline to the United States.The impact will not be felt equally nationwide, because most Canadian oil is shipped to Midwest refineries via pipeline, Kloza said. The states served by those refineries are Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, Montana, Nebraska, Ohio, North Dakota, South Dakota, Pennsylvania and Wisconsin.“Interestingly, 12 of those 16 states begin February with an average retail gasoline price under $3 a gallon,” he said. “That probably won’t last.”
New England gets a lot of gasoline from a refinery run by Irving Oil in Saint John, New Brunswick. That also can be shipped elsewhere, so the diversion of that gasoline could send gas prices in New England up 20 cents a gallon
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