The premier of Canada’s most populous province threatened Wednesday to cut off energy supplies to the United States if President-elect Donald Trump implements proposed tariffs on Canadian goods. The bold move highlights growing tensions between the two countries as they grapple with potential trade tensions.
“Depending on how far things go, we’re going to do everything in our power to shut down their energy, down to Michigan, down to New York, all the way to Wisconsin,” Ontario Premier Doug Ford said. I’m going to go as far as I can.” The press conference followed a virtual meeting with Canadian Prime Minister Justin Trudeau and other provincial premiers to discuss President Trump’s tariff threats. “I don’t want this to happen, but Ontario is the largest province and my number one job is to protect Ontario, Ontarians and all Canadians.”
President Trump threatened in November: Imposing a flat 25% tariff Ban on all products from Canada and Mexico unless Canada and Mexico take steps to curb the flow of drugs and illegal immigration into the United States
The Canadian government says it is considering spending the equivalent of more than $700 million to strengthen border security. To avoid new U.S. tariffs, the plan would increase the number of police officers and buy more equipment, including helicopters and drones, to strengthen border crossings.
Ford said the province, Canada’s federal finance minister and other provinces would compile a list of items on which the United States could impose retaliatory tariffs.
“We need to be ready to fight. This fight will 100% take place on January 20th or January 21st,” he told reporters, referring to President Trump’s Inauguration Day. , “And we don’t know how far this fight will go.” ”
Canada and America will both lose.
Analysts have warned that a tariff war would have a negative impact on both the U.S. and Canadian economies. Canada supplies natural gas to the United States and about 20% of the crude oil used by its southern neighbor. Patrick de Haan, head of petroleum analysis at GasBuddy, made his predictions for U.S. gasoline prices. It could go up 30 to 40 cents per gallon.and could be up to 70 cents soon after Trump’s tariffs go into effect.
Ontario will directly power 1.5 million U.S. homes in 2023 and is a major exporter of electricity to Michigan, Minnesota, and New York.
Midwestern states in particular could face serious risks if President Trump’s tariff plans for Canada, Mexico, and China go into effect. Michigan and Illinois rely heavily on imports from Canada, Mexico and China, which account for 19% and 12% of the states’ GDP, respectively, according to analysts at Fitch Ratings Group. Michigan, which produces nearly 19% of the cars sold in the United States, is particularly dependent on cross-border trade. Meanwhile, Illinois is home to the nation’s fourth-largest crude oil refinery and gets most of its crude oil from Canada.
According to Fitch’s recent analysis, “If enacted exactly as proposed, the wide-ranging tariffs proposed by President-elect Trump would increase tariff rates to levels not seen in the United States since the Great Depression, and significantly “This could cause significant economic shock.”
Experts also warn that tough U.S. tariffs will likely push Canada’s economy into recession in 2025, triggering a spike in inflation and forcing the Bank of Canada to suspend interest rate cuts next year. A recent report from Oxford Economics economist Michael Davenport says Canada’s energy, auto and heavy industry sectors will be hit the hardest because of their high levels of cross-border trade.
“25% tariffs and proportional retaliatory tariffs by the United States will reduce Canadian exports and cause GDP to fall by 2.5% from peak to trough by early 2026. Inflation will soar to 7.2% by mid-2025. , with 150,000 layoffs, the unemployment rate will rise to 7.9% by the end of the year,” Davenport said.
During his first term in office, Trump imposed tariffs on Canadian steel and aluminum exports. Canada retaliated by imposing its own tariffs on U.S. products such as whiskey and yogurt produced at factories in Wisconsin.
contributed to this report.
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Ahmad Mukhtar
