(Bloomberg) — Oil climbed as US President Donald Trump reiterated plans for tariffs against Canada and Mexico from this weekend, although there may be a carve-out for flows of crude.
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West Texas Intermediate rose above $73 a barrel after a modest gain on Thursday, with Brent closing near $77. The US president said he would follow through on his threat to impose 25% tariffs on the two countries’ shipments, and also said he would target China. A decision on whether crude is to be included in the levies, or exempted, may come in the next few hours.
Crude has had a bumpy month, with a run of weekly gains from US sanctions on Russia and cold weather followed by two weeks’ of losses as traders adjusted for Trump’s planned tariffs, which could hamper economic growth and energy demand. The US president has also pressed OPEC to lower crude prices by increasing production.
Canada supplies about 4 million barrels of oil a day to the US, and the two countries’ crude markets are closely integrated. Valero Energy Corp., the third-biggest US fuelmaker by market value, expects domestic production to shrink about 10% if the levies are placed on oil.
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