U.S. President Trump stated Saturday he would slap tariffs on crude imports if he has to “protect” U.S. energy staff from the oil price crash that has been exacerbated by a conflict between Russia and Saudi Arabia’s Aramco over the market share.
Oil prices have dropped by about two-thirds this year as the pandemic crushes demand and as significant producers, Russia and Saudi Arabia increase production in a war over market share.
The U.S., in recent times, has change into the world’s most significant oil producer, at times, putting its exports in competition with Russia and members of OPEC.
As oil costs drop, many heavily leveraged U.S. energy corporations face bankruptcies, and workers are susceptible to layoffs. After meeting with the sector officials Friday, Trump stated he was not contemplating tariffs at the moment, but it was a tool that may very well be used “if we’re not treated fairly.”
Two leading industry organizations, the American Petroleum Institute and American Fuel & Petrochemical Manufacturers, informed Trump in a letter Wednesday that tariffs on oil imports would deteriorate the domestic refining business as some factories depend on crude from overseas.
The U.S. imported an extra 1 million barrels per day of oil from Russia and Saudi Arabia combined last year, based on the U.S. Energy Information Administration.