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Trump tariffs on Canada, Mexico to include oil: Update

  • Market: Crude oil, Fertilizers, Metals, Natural gas, Oil products, Petroleum coke
  • 31/01/25

Updates with comments from Trump, plan for 10pc crude tariff.

President Donald Trump said late Friday he will proceed with plans to impose 25pc tariffs on imports from Canada and Mexico on 1 February, with crude imports likely to be taxed at a lower 10pc rate.

Trump separately plans to impose tariffs on imports from China on 1 February.

Asked if his Canada tariffs would include crude imports, Trump said, "I'm probably going to reduce the tariff a little bit on that," he told reporters at the White House. "We think we're going to bring it down to 10pc."

Trump, who previously tied tariffs on imports from Canada, Mexico and China to their alleged inability to stem the flow of drugs and migrants into the US, today insisted that the tariffs he plans to impose on Saturday in fact have a strictly economic rationale and are non-negotiable.

The tariffs expected on Saturday "are not a negotiating tool", Trump said. "No, it's pure economic … we have big deficits with all three of them."

Trump, in a wide ranging gaggle with reporters, separately mentioned that he would impose tariffs on imported chips and oil and natural gas. "That'll happen fairly soon, I think around 18 February," he said. It was not clear from his remarks if he meant that all oil and gas imports into the US would be taxed, or if he referred to supply only from Canada and Mexico.

Trump said he would also raise tariffs on imported steel, aluminium and eventually copper as well.

Trump brushed away criticism of potential negative impacts from his tariffs.

"You will see the power of the tariff," Trump said. "The tariff is good, and nobody can compete with us, because we have by far the biggest piggy bank."

The looming face-off on tariffs has unnerved US oil producers and refiners, which are warning of severe impacts to the integrated North American energy markets if taxes are imposed on flows from Canada and Mexico. Industry trade group the American Petroleum Institute has lobbied the administration to exclude crude from the planned tariffs.

Canadian prime minister Justin Trudeau reiterated today that Ottawa would retaliate against US tariffs. Mexican president Claudia Sheinbaum also said her country has prepared responses to US tariffs.

Nearly all of Mexico's roughly 500,000 b/d of crude shipments to the US in January-November 2024 were waterborne cargoes sent to US Gulf coast refiners. Those shipments in the future could be diverted to Asia or Europe. Canadian producers have much less flexibility, as more than 4mn b/d of Canada's exports are wholly dependent on pipeline routes to and through the US.

Canadian crude that flows through the US for export from Gulf coast ports would be exempt from tariffs under current trade rules, providing another potential outlet for Alberta producers — unless Trump's potential executive action on Canada tariffs eliminates that loophole.

Tariffs on imports from Canada and Mexico would most likely have the greatest impact on US Atlantic coast motor fuel markets.

New York Harbor spot market gasoline prices are around $2/USG, meaning a 25pc tariff on Canadian imports could up that price by as much as 50¢/USG. This could prompt buyers in New England or other US east coast markets to look to other supply options. Canadian refiners could also start sending their product to west Africa or Latin America.

US refiner Valero said that the tariffs could cause a 10pc cut in refinery runs depending on how the tariffs are implemented and how long they last.

Gas, petchems, steel and ags threatened

The tariffs may affect regional natural gas price spreads and increase costs for downstream consumers, but there is limited scope for a reduction in gas flows between the two countries — at least in the short term.

The US is a net gas importer from Canada, with gross imports of 8.36 Bcf/d (86.35bn m³/yr) in January-October, according to the US Energy Information Administration (EIA). The US' Canadian imports far exceeded the 2.63 Bcf/d it delivered across its northern border over the same period, EIA data show.

Tariffs on Canadian and Mexican imports also will disrupt years of free flowing polyethylene (PE) and polypropylene (PP) trade between the three countries, market sources said.

North American steel trading costs could rise by as much at $5.3bn across the three nations, since Mexico and Canada are expected to issue reciprocal tariffs against the US, as it did when Trump issued tariffs in his first term.

The tariffs could also disrupt US corn and soybean sales, since China and Mexico account for 48pc of US corn exports and 61pc of US soybean exports since 2019, according to US Department of Agriculture (USDA) data.


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13/05/25

Namibia expects first oil in 2029-30: Official

Namibia expects first oil in 2029-30: Official

Paris, 13 May (Argus) — Namibia expects first oil and gas from its offshore oil blocks as early as 2029, according to the country's petroleum commissioner Maggy Shino. Oil and gas production is on track to begin by that time, Shino said, with a first field development plan set to be received from TotalEnergies by July. The French major is a stakeholder in the Venus block, which it estimates to contain 750mn bl. The timeline announcement comes as Namibia seeks to accelerate the path to first oil, Shino said. Windhoek is streamlining licensing processes and is encouraging industry to contribute to upstream policymaking, she told the Invest in African Energies forum today. TotalEnergies, which discovered Venus in February 2022, plans to make a decision on whether to begin the development of the field next year. Its chief executive Patrick Pouyanne said he was negotiating with the Namibian government about the development but that discussions were still at an early stage. "It's a project which faces, fundamentally, some challenges, but it's feasible," Pouyanne told analysts on the company's first-quarter earnings call in April . Speaking at the conference, TotalEnergies' senior vice president for Africa, Mike Sangster, said the three wells the company has tested at Venus have demonstrated the need for a lot of gas reinjection, and he said it will be difficult to keep the cost of development down to Pouyanne's publicly-stated $20/bl. Besides upstream investment, Namibia is encouraging investors to consider port and pipeline infrastructure with a particular emphasis on the coastal town of Lüderitz in the southwest. Namibia's new president, Netumbo Nandi-Ndaitwah, placed the country's oil and gas industries under direct presidential control the day after her inauguration in March. Although details of the restructuring have yet to emerge, some stakeholders hope the move will speed up decision making. By George Maher-Bonnett Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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ISTA blasts 'ludicrous' Tata Steel UK assertion to TRA


13/05/25
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13/05/25

ISTA blasts 'ludicrous' Tata Steel UK assertion to TRA

London, 13 May (Argus) — Tata Steel UK's claim to the Trade Remedies Authority (TRA) that 2m-wide hot-rolled coil (HRC) could be bought for slitting is "ludicrous", according to the International Steel Trade Association (ISTA). In a submission to the TRA as part of its safeguard review, Tata said that if 2m-wide material, which it does not produce, is removed from the safeguard, it would be bought and slit, meaning it is no different from the material produced by Tata . But ISTA said 2m-wide HRC is a "significant part" of the yellow goods market and is used by companies such as JCB, Caterpillar and Liebherr for earth-moving, construction and agricultural equipment. It is also used in pipe and tube production and does not constitute a small proportion of the overall market, as suggested by Tata, ISTA said. The material must be imported as it is not manufactured in the UK and carries a premium over speed-stock widths produced by Tata. "For Tata Steel, who import volumes of this width themselves, to suggest that wider coil is ‘often imported only to be slit to narrower cuts' is ludicrous," ISTA said, arguing that there are "almost no" slitting lines in the UK that are capable of slitting 2m-wide material. The lines that do exist typically slit hot-dip galvanised (HDG) rather than HRC, Argus understands. Importers have also questioned the economic rationale of Tata's assertion that if higher-yield HDG is removed from the safeguard, importers would buy it and use it to compete with more commoditised grades produced by Tata. Higher-yield material carries a premium, and it would make no economic sense to pay it and then compete in the commodity market, trading firms told Argus . The TRA, which is expected to announce its provisional findings this week, is widely anticipated to propose caps on the quota for other countries' HDG. Importers told Argus that they were surprised by the aggressive tone of Tata's rebuttal to claims fielded by importers about material that it does not produce being excluded from the safeguard. By Colin Richardson Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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India’s Vedanta expands metals exploration


13/05/25
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13/05/25

India’s Vedanta expands metals exploration

Mumbai, 13 May (Argus) — Indian private-sector mining firm Vedanta is exploring critical mineral assets in six states as it looks to strengthen its position in the fast-growing clean energy value chain. Vedanta is exploring for copper, nickel, cobalt, chromium, vanadium, tungsten and platinum-group elements (PGEs) in states such as Maharashtra, Rajasthan, Bihar, Arunachal Pradesh, Karnataka, and Chhattisgarh supported by India's policy push for mineral security , it said on 10 May. Vedanta secured four mineral blocks in the fourth round of India's critical mineral auctions. It won a vanadium and graphite block in Arunachal Pradesh and a cobalt, manganese, and iron (polymetallic) block in Karnataka. Its subsidiary Hindustan Zinc (HZL) was awarded one tungsten block in Andhra Pradesh and another in Tamil Nadu. The company is expanding its value-added aluminium products capacity in billets, primary foundry alloys, rolled products and wire rods. Aluminium billets are used in the aerospace, defence and solar power sectors, while aluminium rolled products are used in high-speed railways, electric vehicles, pharmaceuticals and battery enclosures. HZL is exploring uses for zinc beyond galvanizing steel to protect it from rust, which currently accounts for over 60pc of global zinc demand. It has entered the zinc alloy sector with a 30,000t plant and plans to significantly increase the share of value-added products in its aluminium portfolio to over 90pc in the near term. Vedanta's board earlier this year approved an investment of about $1.5bn to expand its aluminium capacity, including an expansion at its smelter in Orisha to increase production, as well as increased value-added product capacity at its flagship aluminium plants. By Deepika Singh Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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US tariff to curb Japan’s crude steel output in FY25


13/05/25
News
13/05/25

US tariff to curb Japan’s crude steel output in FY25

Tokyo, 13 May (Argus) — Japan's major steel producers will likely cut their crude steel output in the current fiscal year ending in March 2026, partly because the US' blanket 25pc tariff on automobile imports will curb domestic car productions. The country's largest and second-largest steel mill by capacity Nippon Steel and JFE Steel estimates crude steel output at 33mn t and 21mn t respectively in April 2025-March 2026, both down on the year by around 1mn t. This comes as the US' tariffs on automobile imports is likely to cap domestic car production, according to the firms. The US levy could potentially reduce several hundred thousand tonnes of its steel products sales given that 20pc of the Japanese domestic car production is exported to the US, said JFE. Nippon Steel also forecasts lower steel demand because of a possible fall in auto and machinery exports to the US, although it is difficult for the company to evaluate the quantitative impact on the wider supply chain. Nippon Steel estimates Japan's total car exports to the US, including delivery via Canada and Mexico, is currently around 2.8mn units/yr, all of which could be subject to the US tariffs. Nippon Steel is cautious about providing its output projections given the unstable climate over the ongoing trade negotiations between Tokyo and Washington. Forecasting crude steel output for the current fiscal year is difficult given uncertainty over the possible impact of US tariff measures, Nippon Steel told Argus . JFE also said "further risk analysis is necessary", suggesting a possible revision of its production outlook. Meanwhile, Nippon Steel expects no significant impact from the US tariffs on its direct steel products delivered to the country for the time being. The impact of the tariffs will be limited given the firm's value-added products such as high-alloy seamless pipe are exported in small volumes and difficult to replace with other products, the company said. Some of its US clients designate Nippon Steel as the supplier of these products because US local manufactures are unable to produce them, the company added. Nippon Steel did not provide their export volumes. Domestic steel demand Domestic steel demand is also unlikely to recover in the short term regardless of the US tariff. The country's domestic crude steel output has been consistently falling over the past several years, but the recent downtrend appears to be especially worrying for the Japanese steel producers. The current slump in domestic steel demand is more severe than expected, Nippon Steel said, forecasting the continuous downtrend in steel demand for most of the steel consuming sectors including auto, construction and manufacturing industries. Sluggish demand has even led JFE to decide to completely close one of its steel production facilities. JFE announced on 8 May that it will shut down its No. 4 basic oxygen furnace (BOF) steel plant in western Japan's Fukuyama sometime in April 2027-March 2028, as part of the mid-term strategy. This will reduce the company's domestic steel production capacity to 21mn t/yr, down by 500t from the 2024-25 level, the company added. JFE decided to close the BOF plant because domestic steel demand is likely to continue falling on the back of shrinking populations and labour shortages, according to the firm. These are causing delays in construction projects and therefore weighing on steel demand, the firm added. By Yusuke Maekawa Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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India proposes retaliatory taxes to US' steel tariffs


13/05/25
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13/05/25

India proposes retaliatory taxes to US' steel tariffs

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