Canada’s Energy Minister says all U.S. tariffs should be scrapped, not just those on oil and gas

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Canada’s Minister of Energy and Natural Resources says he wants U.S. President Donald Trump to withdraw all the tariffs he has threatened to impose on industries across the Canadian economy rather than grant exemptions for oil and gas.

Jonathan Wilkinson said on Tuesday that Canadian officials remain focused on creating pressure on Washington to persuade the President to pull back from punishing trade duties that would ultimately harm consumers in both countries. That includes encouraging state and industry officials to press Canada’s case.

Mr. Wilkinson made the comments in Houston a day after his U.S. counterpart, Energy Secretary Chris Wright, said it was “certainly possible” that Canadian oil and gas – representing the country’s largest export to the United States – could be excluded from U.S. tariffs. Mr. Wright offered no guarantees, however.

“Obviously having tariffs removed on energy would, I guess, be positive in some respects, but we’re not interested in sectoral exemptions. We’re not interested in partial exemptions,” Mr. Wilkinson said in an interview at the CERAWeek by S&P Global conference.

“We’re interested in seeing the tariffs removed and going back to the free trade agreement that we actually had jointly negotiated with President Trump, and we will keep pushing irrespective of any sectoral things that they do,” he said.

What the tariff war may mean for gasoline prices

In terms of pressure on Mr. Trump, uncertainty created by his on-again, off-again tariff threats have triggered a massive sell-off in the stock market, a gauge he watches closely, the minister said. “Something in the range of US$4-trillion in wealth, or in value, has been wiped out in the last few weeks, but it’s also putting pressure on Americans who are going to end up paying the price for these tariffs.”

American companies face higher costs for essential Canadian products such as steel and aluminum, as do consumers on everything from home heating fuel to gasoline to new vehicles, he said.

Canada has responded with retaliatory measures on a range of items. They include countertariffs on hundreds of products, with a first wave totalling US$30-billion of goods such as Florida orange juice, Kentucky bourbon and Pennsylvania motorcycles.

“I think over time that is going to have a significant effect, as will the economic fallout, which is not just the market, but almost certainly you’re going to see rising inflation and rising prices,” Mr. Wilkinson said.

Several Canadian government and industry officials are at the CERAWeek event to seek clarity on the President’s tariff threats, and to meet with their counterparts from the U.S. and elsewhere in hopes of reaching agreements to limit economic damage.

Mr. Wilkinson met on Tuesday with Mexican Energy Secretary Luz Elena González, and the two agreed to co-ordinate their efforts more closely and work toward deepening trade ties to deal with the U.S. tariffs.

“Canada is going to need to think about much more strategically focusing on how we actually diversify our trade away from such dependence on the United States,” he said. “We will always trade with the United States, but I will just say – and I’ve said this publicly – Canadians will never trust the Americans in the same way that we did three months ago.”

Brian Jean, Alberta’s Energy and Minerals Minister, welcomed the prospect of oil and gas being carved out of the tariff threats. Fossil fuels were already granted with a lower duty – 10 per cent versus 25 per cent for most other Canadian exports. Under Premier Danielle Smith, the province has taken a stance that is more sympathetic to Mr. Trump’s aims, which include establishing U.S. “energy dominance.”

Mr. Jean said he believes there has been progress in talks with U.S. officials, as the province pushes the advantages of continentwide energy security.

“Yes, whenever there’s ability to communicate back and forth at a senior level, which we’re doing, then we believe there’s optimism in the room, and we have the opportunity to remove the tariffs and that’s exactly what we want to do,” he told reporters.

“What are we doing? We’re providing options that would be attractive to the Americans in relation to their long-term goals and we don’t have a problem doing that. We think we would be much better and more effective together for all of our citizens.”

He pointed out that the U.S. imports more than four million barrels of Canadian oil a day, and that is roughly the same volume that the U.S. exports to other countries.

Mr. Wilkinson rejected any notion that the federal Liberals’ leadership transition, to Mark Carney from Prime Minister Justin Trudeau, has hindered Canada’s ability to deal with Washington amid Mr. Trump’s frequent threats and about-faces. As of now, he and other key ministers on the file remain in place.

“We’ve been in active contact, including today, and I have full authority on behalf of the government of Canada to work in the areas of energy and natural resources,” he said. “Of course there will be a swearing in in the coming days and then there will be a new set of ministers, and I may be in this chair, I may not be in this chair. But until that happens, I am fully in charge.”