Copy of AFF Sentinel V22 #10-Tariff Eve?
- Steve Dittmer
- Jul 22, 2025
- 3 min read
Lots of Last Minute Scrambling
Steve Dittmer | AFF Sentinel
Colorado Springs, CO
Originally sent to subscribers 01/31/25
One thing is different in this Administration. The team is not very leaky. There has not been a lot of information about negotiations behind the scene before now.
But while President Trump has not hinted much beyond his intention to invoke 25 percent tariffs on Canada and Mexico and 10 percent on China on Saturday, February 1.
Today, some information has been volunteered about aides to the President trying to find some “off-ramps” to avoid universal tariff impositions. But the information has been more that there has been lots of activity but not as much about what kind.
As of late Thursday night, it had not been decided if the tariffs would be on everything or targeted to certain products, e.g. oil or steel. It also hadn’t been decided what authority or laws would be used. There are several possible avenues but the team has been trying to figure out what avenue would be least likely to garner lawsuits, as other Administration moves have in the first two weeks, (“Trump Aides Hunt for Deal to Dial Back Tariff Threat,” Wall Street Journal, 01/31/25).
A briefing late Friday afternoon included a message for American consumers that tariffs were expected to be short-term.
That statement plus indications from D.C. seemed to imply that if negotiations were not completed by Saturday, a “grace period” to allow for further negotiations was a possibility.
Both Canada and Mexico have been preparing lists of goods slated for retaliatory tariffs if Trump does indeed levy tariffs.
Bret Baier on Fox News channel reported late Friday that Trump was “suggesting he might try to blunt the effect” on oil imports by reducing the tariff to 10 percent on Canadian oil.
While we are the globe’s largest producer of oil at roughly 13 million barrels/day, we use 19 million barrels/day. So we import about 6.5 barrels/day of oil, about 3.9 of that from Canada.
A tariff of 25 percent is roughly $15/barrel added to the price of oil. The U.S. buys Canadian oil at about a $13/barrel discount now, so a 25 percent tariff would about take that discount out, according to one Canadian producer Fox interviewed. The U.S. tends to use the cheaper Canadian oil and sell more expensive American oil overseas. We have refineries set up to handle the heavier Canadian crude.
Roughly 13 percent of all goods imported into the U.S. come from Canada, about a total of $320 billion worth of good set to fall under the tariff Saturday, Fox said.
Both Canada and Mexico have been working with the U.S. to put together task forces, Canada specifically on fentanyl and Mexico on multiple immigration issues. Both countries say they have been working hard to satisfy the Administration’s demands.
Of course, U.S. firms whose supply chains depend on Canadian and Mexican products plus labor unions are lobbying hard in D.C. to be exempt from the tariffs.
The nominee for running the Commerce Department, Howard Lutnick, make comments Friday that the tariffs were a “cudgel” to use in getting some things the Administration wanted.
A separate story in the Wall Street Journal recently outlined the massive difficulties Mexico is dealing with, with thousands of immigrants who have stalled there after hoping for entry into the U.S., including Mexicans and others from other South American countries. Thousands are still coming into Mexico every day from other countries. The planeloads of illegals deported into Mexico from the U.S. in recent days have included both Mexican citizens and citizens of other countries.
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