The Impact of Trump’s Tariffs on Gasoline Prices Will Be Limited, Experts Say
According to Tom Kloza, global head of energy analysis for OPIS, the impact of President Donald Trump’s new tariffs on gasoline prices will be limited. The tariff on Canadian energy products is only 10%, which is lower than the full 25% on other Canadian imports. Additionally, gas prices are typically near a low for the year in February due to weak demand.
While the tariffs are not expected to have a significant impact in February, if they remain in place through the summer, the impact will grow. Kloza describes the tariffs as “inflationary, but not as inflationary as it would be in April, May or June.”
The impact of the tariffs will not be felt equally nationwide, as most Canadian oil is shipped to Midwest refineries via pipeline. The states most likely to be affected are Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, Montana, Nebraska, Ohio, North Dakota, South Dakota, Pennsylvania, and Wisconsin.
Interestingly, 12 of these 16 states begin February with an average retail gasoline price under $3 a gallon, which may not last if the tariffs remain in place.