Canada should use the nuclear option against Trump

Canada should use the nuclear option against Trump

As soon as February 1, the U.S. might impose a 25 percent tariff on all imports from Canada. Crude oil is one of the biggest Canadian exports to the U.S.

One possibility for retaliation, termed the “nuclear option”, is to cut off all crude oil exports to the U.S. Currently Canada supplies about 2/3 of U.S. oil imports.

Should Canada go with the nuclear option if tariffs are imposed?


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Is another in any way feasible option a plan to set a maximum on the difference between WTI and the price of Cdn oil shipped to US, and set an export tax equivalent to any amount exceeding that maximum? Have no idea whether that’s even possible but the thought has occurred. Tax revenue could be shared with industry and/or AB govt too, although some would logically help other industries hit by tariffs. Worst outcome would be US imposing tariffs on everything except oil, which is the only area they carry an aggregate trade deficit, and AB insisting it should be spared while everyone else has to live with the costs. With the US industry now pleading to exempt oil from tariffs, that outcome seems to be a possibility.

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