Generic Hero BannerGeneric Hero Banner
Latest Market News

US still eyes 1 February for Canada, Mexico tariffs

  • Spanish Market: Crude oil, Natural gas, Petroleum coke
  • 28/01/25

President Donald Trump is still keen to impose tariffs on all imports from Canada and Mexico as soon as 1 February, the White House said today.

Trump in multiple public comments since taking office on 20 January said he was still considering a 25pc tariff on Canada and Mexico, even though his administration has yet to provide any details on the proposal.

Trump spent much of his meeting on Monday with Republican lawmakers at their annual retreat in Florida blasting Canada and Mexico over their allegedly unfair trade practices.

Tariffs should become a key source of income for the US government, just as they were in the nineteenth and early twentieth century before being supplanted by income taxes, Trump told the lawmakers, who are looking at ways to extend tax cuts enacted during his first term and set to expire at the end of 2025.

Trump also said he would impose tariffs on all imported computer chips, semiconductors and pharmaceuticals. Trump's messaging on China tariffs has been more mixed. He said last week he would go on with his initial plans to impose a 10pc tax on all imports from China, but he also said he preferred to avoid a trade war with Beijing.

An executive order Trump signed on 20 January lays out a process suggesting timelines of June-July for imposing tariffs on the US' key trading partners, with no reference to the 1 February deadline.

But Trump has the legal authority to impose tariffs on imports from any country by a variety of executive actions and with very short notice, as he demonstrated over the weekend during a high-profile confrontation with Colombia over deporting migrants from the US.

Trump told the lawmakers on Monday that he expects to wield the threat of tariffs as a negotiating tool often, because even "a very strong country" like Colombia caved in to his demands.

Canada and Mexico appear to be preparing for a protracted trade confrontation with the US if Trump follows through on his threat, with retaliatory measures targeting specific US products and companies.

The looming faceoff has unnerved the 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 to the US. Industry group American Petroleum Institute is lobbying the Trump administration to exempt crude and other energy products from any tariffs he plans to impose.

Trump last week shrugged off the arguments from the US energy industry about potential negative impacts from confronting Canada and Mexico.

"We don't need their oil and gas," Trump said. "We have our own, we have more than anybody."

Almost all of Mexico's roughly 500,000 b/d of crude shipments to the US through November are waterborne, targeting Gulf coast refiners, and can be diverted to Asia or Europe.

Canadian producers have much less flexibility — more than 4mn b/d of Canada's exports are wholly dependent on pipeline routes to and through the US. Only around 900,000 b/d can be directed away from the US via the recently expanded Trans Mountain pipeline system to the Pacific coast, although late-2024 flows were actually closer to 400,000 b/d, split evenly between the US west coast and Asia.

Conversely, many refineries in the US midcontinent have no practical alternative to the Canadian crude. US gasoline prices would move higher by 30-70¢/USG if the 25pc tariffs that Trump has threatened were applied to Canada's oil, Canada's TD Bank projects.

Trump's commerce secretary nominee Howard Lutnick will face a confirmation hearing at the Senate Commerce committee on Wednesday, with trade wars likely to feature high among the questions lawmakers direct at him.


Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

03/02/25

US delays Mexico tariffs by a month: Update

US delays Mexico tariffs by a month: Update

Adds comments from press conference, White House response, historic context. Mexico City, 3 February (Argus) — The US has agreed to postpone the 4 February implementation of 25pc tariffs on Mexican goods by one month to allow more time for negotiations, President Claudia Sheinbaum said today. Under an agreement with the US, Mexico will immediately reinforce its border with the US with 10,000 national guard troops to limit drug trafficking into the US, with a specific focus on fentanyl, Sheinbaum posted on social media platform X. The US pledged to take stronger action to curb the flow of high-powered firearms into Mexico, she said. The pause will allow "Mexico time to demonstrate good results for the US people and our people" on key security concerns, Sheinbaum said. US president Donald Trump confirmed the tariff delay in a social media post, saying there would be negotiations in the coming weeks with Mexican officials and US secretary of state Marco Rubio, secretary of the treasury Scott Bessent and secretary of commerce Howard Lutnick. The White House praised Mexico's willingness to respond positively to the tariff threats, while characterizing the Canadian response as [a] misunderstanding. "The good news is that in our conversations over the weekend, one of the things we've noticed is that Mexicans are very, very serious about doing what President Trump said," White House National Economic Council director Kevin Hassett said in a broadcast interview. Canada had "misunderstood the plain language of the executive order and they're interpreting it as a trade war." Trump said this morning that he "looks forward to negotiations" with Sheinbaum to reach a deal between the countries. He is also talking to Canadian premier Justin Trudeau later today. The announcements today do not address Trump's complaints of a trade deficit with Mexico, which Sheinbaum said during a press conference today the US misinterprets as a negative. Both the US and Mexico benefit from the region becoming more competitive, she said. Mexico will also keep its retaliatory tariffs on the table: "We will save Plan B for later, if necessary," Sheinbaum said. The current tensions are similar to those from 2019, when Trump threatened to impose 5pc tariffs on all Mexican goods. He relented when former president Andres Manuel Lopez Obrador said Mexico would deploy 21,000 national guard troops to contain the flow of migrants toward the US. If the tariffs were implemented, it would disrupt the energy trade between the US and Mexico. 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. Mexico also imports much of its road fuels and LPG from the US. But the country is unlikely to hit these goods with retaliatory tariffs, according to market sources. By Antonio Gozain and Cas Biekmann Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Ice TTF gas risk reduction contract positions soar


03/02/25
03/02/25

Ice TTF gas risk reduction contract positions soar

London, 3 February (Argus) — Risk reduction contracts held at the Dutch TTF gas trading point on the Intercontinental Exchange (Ice) soared to a near record high in the week ending 24 January, suggesting significant hedging activity. Firms take on risk reduction contracts mostly for hedging purposes — they offset a physical position with a paper position so as to reduce exposure to price fluctuations. When firms inject gas into storage, they might for example open a risk reduction contract on paper to offset this position in the future. The gross amount of gas that commercial undertakings hold under long and short risk reduction contracts combined reached its second highest since at least 2018 at 1.38PWh in the week ending 24 January, the most recent data from Ice ( see risk reduction graph ) show. Firms increased their long positions by 19TWh week on week to 581TWh, and their short positions by 13TWh to 794TWh. After netting the two off, commercial undertakings hold a net short position of around 214TWh of risk reduction contracts, down from a recent peak of 228TWh in the week ending 3 January. Higher LNG deliveries to Europe in recent weeks may have driven some of the interest in risk reduction contracts, given that importers need to hedge ahead of time in order to lock in margins. TTF prices have increased enough in recent weeks to firmly close the arbitrage between the Atlantic and Pacific basins, attracting more LNG cargoes to Europe. European LNG imports soared in January to their highest for any month since April 2023. The TTF summer 2025 contract's growing premium to the winter 2025-26 market may have additionally boosted interest in risk reduction contracts. The spread widened sharply after Germany's THE announced a consultation for a new kind of storage tender that would subsidise injections if seasonal spreads stay inverted , with many traders seeing this as a signal that German storage sites will be refilled , regardless of commercial incentives. The TTF summer 2025-winter 2025-26 spread jumped to +€4/MWh on 21 January, the day of THE's announcement, from +€2.73/MWh a day earlier, and widened further to as high as +€6.39/MWh by 30 January. In terms of total net positions across all contract types, investment funds held a net long of nearly 278TWh in the week ending 24 January, the highest since late November. At the same time, investment and credit firms held their highest net short position since October 2021 at 245TWh. Commercial undertakings held a net total short position of 33TWh ( see net positions graph ). By Brendan A'Hearn ICE TTF net contract position TWh Commercial undertakings' risk reduction contract positions TWh Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

US manufacturing expands in Jan after 26 months: ISM


03/02/25
03/02/25

US manufacturing expands in Jan after 26 months: ISM

Houston, 3 February (Argus) — US manufacturing activity expanded in January after 26 consecutive months of contraction, according to the Institute for Supply Management's latest factory survey. The manufacturing purchasing managers' index (PMI) registered 50.9 in January, up from 49.2 in December. The new orders index rose to 55.1 last month from 52.1 in December, marking a third month of expansion. Readings above 50 signal expansion while readings under that point to contraction. Production rose to 52.5 last month from 49.9 the prior month. Employment rose to 50.3 from 45.4. "Demand clearly improved, while output expanded and inputs remained accommodative," ISM said. "Demand and production improved; and employment expanded." US factory activity expanded robustly in the first two years after Covid-19 hit, then contracted for the subsequent two years, even as growth in services activity, the largest part of the economy, maintained the overall economy in expansion territory. The new export orders index rose by 2.4 points to 52.4 and the imports index rose by 1.4 points to 51.1. The prices index rose to 54.9 from 52.5, with aluminum, freight rates, natural gas, and scrap among gainers. "Prices growth was moderate, indicating that further growth will put additional pressure on prices," ISM said. The inventories index fell by 2.5 to 45.9, signaling contracting inventories. Backlog of orders fell by one point to 44.9, indicating order backlogs contracted for the 28th consecutive month after 27 months of expansion. Supplier deliveries rose by 0.8 to 50.9, suggesting marginally slower deliveries. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Ontario bans US companies from provincial contracts


03/02/25
03/02/25

Ontario bans US companies from provincial contracts

New York, 3 February (Argus) — Ontario's premier Doug Ford banned US companies from provincial contracts until President Donald Trump lifts his planned tariffs on Canada . "US-based businesses will now lose out on tens of billions of dollars in new revenues," Ford said on social media platform X today. "They only have President Donald Trump to blame." Ontario also plans to tear up the province's contract with Elon Musk's Starlink internet services as part of a retaliatory move following Trump's decision to impose tariffs. "Ontario won't do business with people hellbent on destroying our economy," Ford said. "Canada didn't start this fight with the US, but you better believe we're ready to win it." Canada announced a targeted list of counter-tariffs that will go into effect on 4 February. Ford has been particularly outspoken among Canada's provincial leaders , given the Ontario's close ties with the US auto industries and steel industries in particular. By Stephen Cunningham Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

US delays Mexico tariffs by a month


03/02/25
03/02/25

US delays Mexico tariffs by a month

Mexico City, 3 February (Argus) — The US has agreed to postpone the implementation of 25pc tariffs on Mexican goods for one month, "allowing Mexico time to demonstrate good results for the US people and our people" on key security concerns, President Claudia Sheinbaum said today. Under the agreement Mexico will immediately reinforce its border with the US with 10,000 national guard troops to prevent drug trafficking into the US, with a specific focus on fentanyl, Sheinbaum posted on social media platform X following a conversation with President Donald Trump. The US pledged to take stronger action to curb the flow of high-powered firearms into Mexico, she said. US president Donald Trump confirmed the tariff delay in a social media post, saying there would be negotiations in the coming weeks with Mexican officials and US secretary of state Marco Rubio, secretary of the treasury Scott Bessent and secretary of commerce Howard Lutnick. The tariffs were originally set to take effect on 4 February. By Antonio Gozain Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Generic Hero Banner

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more