Experts Predict Consumers Will Be ‘Worse Off’ As Trump Tariffs Raise Prices on Goods and Energy

Prices may soon increase at the pump due to tariffs on gas imported from Mexico and Canada enacted by President Donald Trump.

President of Mexico Claudia Sheinbaum has reached a deal with the Trump administration to delay the tariffs for a month, while import duties on Canadian and Chinese goods will go into effect on Tuesday.

The impact of the tariffs could harm oil companies and increase gas prices, The New York Times said.

“It’s going to be very, very messy” if the president goes ahead with the tariffs, said Tom Kloza, Oil Price Information Service’s global energy analysis lead, as The New York Times reported. “We haven’t dealt with something like this, certainly not in the modern era.”

"Enormous Destruction": Trump's Tariffs on Mexico, Canada & China Set to Worsen Inflation

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The United States also purchases Canadian electricity, natural gas and uranium, which is used to make nuclear power plant fuel.

As a reason for imposing the tariffs, Trump cited a national emergency related to undocumented immigrants coming into the U.S., as well as the flow of the drug fentanyl into the country, reported CNN.

The 25 percent duty on most goods imported from Canada includes a 10 percent exception for crude oil and other energy-related items.

Trump has said he will use the tariffs to raise revenue, bring other nations to the negotiating table and balance trade.

But economists have warned the tariffs would have a negative impact on U.S. consumers and businesses. The U.S. Chamber of Commerce on Saturday said the duties would not solve border issues, but would instead threaten supply chains while raising prices for Americans.

“Consumers are going to be clearly worse off,” Sung Won Sohn, Loyola Marymount University professor of finance, told CNN. “When you talk about a tariff, it’s an economic war; and in war, everybody loses. But hopefully we will come to some better results and conclusions as a result of the pain and suffering that we will go through.”

Here’s what will get more expensive from President Donald Trump’s tariffs on Mexico, Canada and China: cnn.it/4gottxC

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About a third of American imports come from Mexico, Canada and China, including fruits and vegetables, electronics, meat, clothing, toys, gas, lumber, beer and spirits.

Ninety-seven billion dollars worth of Canadian oil and gas was imported into the U.S. last year. According to U.S. Energy Information Administration data, the country has come to rely more on oil from our neighbor to the north since the Canadian Trans Mountain pipeline was expanded.

“[E]xpect fuel prices, including diesel, heating oil, jet fuel, gasoline, propane to rise slightly, primarily in the Great Lakes, Midwest, Rockies, and Northeastern U.S. in the days ahead,” said Patrick De Haan, a GasBuddy analyst, on X.

Haan predicts “localized” increases of five to 20 cents per gallon, reported Axios.

Gas prices in February are usually lower because of weak demand, CNN reported, but if the tariffs are still in effect through the summer, Kloza said the effect will be greater.

Kloza said the states most likely to feel the biggest impacts are Illinois, Indiana, Idaho, Iowa, Kentucky, Kansas, Michigan, Minnesota, Montana, Nebraska, Missouri, North and South Dakota, Ohio, Pennsylvania and Wisconsin.

“Interestingly, 12 of those 16 states begin February with an average retail gasoline price under $3 a gallon,” Kloza said. “That probably won’t last.”