Cars and agricultural products are not the only goods the Trump administration is targeting. As part of the tariff package announced on March 5, the US hit a 10% Canadian energy fee except 25% tariffs for almost all goods imported from Canada and Mexico. Although some of these, such as 25% in car manufacturers, are temporarily excluded, the situation continues to change until the day, if not an hour. Currently, fees for almost all Mexican products have been suspended again until April 2.
On paper, the US imports only about 1% of its energy needs, but the northeast network is significantly intertwined with the Canadian energy market. “Some US states may see that energy costs increase rapidly, while others may have a delayed effect over a few weeks,” said Javier Palomarez, founder and CEO of the Hyspanic Business Council of the United States.
Ontario Doug Ford Prime Minister is preparing to tax the transmission of electricity to the US, which can also increase costs in the northeast, where the price of energy is already higher than the national average. The US is an importer of Canadian power, buying 2,700 gigawatts of energy in 2024. New York received the largest power in 2024, at 8.76 million megawatts.
This has the important potential to raise energy prices and other costs for US consumers in some regions, but some impacts may not be immediately visible. To determine what can happen, we talked to experts to evaluate the effect American tariffs can have on you.
Toyota factories in Alabama and Kentucky will receive a large injection of cash from Ltd in order to compensate possible fees.
Here’s what the energy prices tariffs can do
“Since US companies pay the additional cost of importing goods, consumers can face higher prices for an abundance of goods and services, such as transport, gas, electronics, raw materials, metals, vehicles, products, equipment and agriculture, only to name some,” Palomarez said.
Northeast states and states highly supported on transport and goods from taxed countries can feel more important effects. The duration of the highest costs will depend on how companies absorb costs and concentrate their strategies for internal production and consumers.
Impacts are likely to spread to some key sectors.
Short -term impact on prices are likely to be limited
The good news is that the impact of tariffs on consumers may not be immediate, according to the two experts we talked to.
“Markets (manufacturers and customers) have already been regulated for higher prices,” said Jonathan Colehower, a UST supply chain expert, a 5G digital technology company, he and retail services. “Reality will not be hit for another six months, just in time for holiday planning.”
This means that customers can expect rising prices to be hit towards the end of the year, assuming the tariffs remain in force.
With energy prices in particular, the increased costs in the wholesale market may not appear in the tariffs that individual customers pay for a while.
Chaos and back and forth on tariffs are unlikely to help maintain low prices. Currently, some tariffs, such as the one in vehicle manufacturers, are again delayed. Mutual tariffs are expected to enter into force on April 2. Manufacturers have probably appreciated this.
A region where we can see an immediate impact on prices is Midwest and New England. According to Will Hares, old analyst, European Oil & Gas in Bloomberg Intelligence, Midwest relies on Raw Canadian and New England is exposed to Canada’s Irving Oil Refinery Exports. Power is likely to be affected less, in addition to Ontario’s threat to interrupt electricity exports to 1.5 million homes in New England.
China can also be targeted by Intel and the holding enterprise owned by Calvin Klein and Illumina as part of its response to the tariffs set by the US
Impact on oil
Tariffs can have mixed effects on oil in particular. According to Rob Thummel, Tortrofoli’s senior manager in Tortoise Capital, Canada exports approximately 4 million barrels of oil a day in the US. Also, the largest source of raw oil imports in the US since 2000 and Canadian raw oil is cheaper than the US raw up to $ 20 per barrel.
“The imports of Canada and Mexico make up 25% of the oil we refine in gasoline and Canada only accounts for nearly 20% of our natural gas supply,” Palomers said. “While long -term impacts are expected to be resolved at a price increase of 2% -5%, the issue can be composed with existing market stressors. For example, the price of natural gas has already increased 111% in the past year. After tariff announcement, it is increasing at a rate of 14% per week.”
However, this impact is likely to be disproportionate in certain regions. Midwest is expected to be adversely affected. “Canada provides 4 million barrels per day raw oil in the US, representing 60% of US oil imports,” Hares said. “The American Midwest receives 100% of his oil from Canada and is likely to be one of the most exposed regions for price changes.”
Other experts we talked to did not think that the impact on oil itself would be as important as the effects of the rest of the economy. “Tariffs can have a modest effect on oil prices from imports and exports themselves, but if tariffs stay in the country, inflation can cause a recession that would eventually reduce oil prices,” said Jason Delorenzo, director and owner of AD Deum Funds and Volland trading platform.
Donald Trump has pledged to raise fees for all types of products and that may include solar panels. Higher tariffs are likely to lead to higher prices for consumers.
Impact on renewable
Tariffs can significantly affect renewable energy. This means that going solar can become more expensive, but it can also affect other industries.
“Trump’s tariffs can significantly damage the electrical, solar, battery and wind industries,” Palomarez said. “Look at it this way: China supplies 75% of the world’s lithium-ion batteries; Mexico supplies 40% of our imported steel; and Canada supplies half of America’s refined nickel. These are all critical components of solar panels, wind turbines and batteries.”
This also means that, combined with automatic tariffs, the adoption of electric vehicles can become much more expensive.
However, Hares disagreed that China’s tariffs would significantly affect renewable energy prices. “China is not an important supplier of renewable equipment for the SH.BA mainly for pre-existing tariffs,” Hares said. “China controls over 85% of the global solar supply chain and China’s pre-existing solar tariffs (now 70%) had already eliminated the US demand for solar China.”
Basically, US consumers are already paying higher solar prices due to pre-existing tariffs. Less than 1% of direct solar imports came from China, with US companies choosing to import from Southeast Asia, leading to higher prices in the US compared to China.
A container ship discharges its load from Asia to the Long Beach Port. A new round of fees for consumer goods imported from China is set to take effect on December 15, unless the US and China reach a trade agreement.
Impact on the economy
“The rapid implementation of extreme tariffs in its nature will disrupt our economy, hitting small businesses and the most difficult families,” Palmorez said. This has long been the consensus of economists, with some credit the act of smoot-hawley tariffs with the reduction of global trade and the deterioration of the Great Depression.
“Tariffs are not excellent for the general economy,” Delorenzo said. “At this time, businesses should measure what is most important to them, profits or market share. If profits, they will exceed these costs to consumers. If the market share, they will assume much of these costs.”
What can worsen things is if the US enters into a spiral tariff war with its nearest trading partners. “We have already seen the initial stages of revenge tariffs from Canada to $ 30 billion of US products, with significant further escalation of $ 125 billion promised whether US tariffs remain in the next 21 days,” Hares said. China has also responded, while Mexico is stopping for now.
According to Brookings, SH.BA, Mexico and Canada can all predict a big hit for their economies if tariffs remain in the country. Expect increased inflation, decreased economic growth, job loss, downturn wages and a contraction in exports between all parties.