Canada (Commonwealth) _ Canada recorded its largest surplus with its principal trading partner since 2022 as a result of a spike in energy exports to the US in the latter half of 2024. As the Canadian dollar declined and traders piled up supplies in anticipation of Trump’s tariffs, crude oil exports surged. The trade surplus increased from C$8.2 billion to C$11.3 billion in December, while U.S. crude exports increased 11.8% in the last quarter.
In contrast to 62% of all imports from the United States, over 76% of Canada’s total exports were sent to the United States. The value of Canada’s imports and exports to the United States exceeded C$1 trillion for the third consecutive year last year.
In a report to investors, Andrew Grantham, an economist at the Canadian Imperial Bank of Commerce, stated that while the 5% increase in exports to the United States may have been due to some anticipation of possible tariffs, higher oil prices would also have contributed to that increase. Increased trade activity in C$ terms was also a result of the Canadian dollar’s ongoing fall during the month.
Trump threatened to impose a 10% tariff on China and 25% duties on Canada and Mexico over the weekend. 44% of U.S. imports of oil products, 69% of imports of crude oil, and 81% of imports of heavy crude oil are from oil flows that are subject to tariffs.
In the first ten months of 2024, the United States imported approximately 6.6 million barrels per day (mb/d) of crude oil, of which 4.0 mb/d was heavy oil for use in upgraded refineries with cracking units. Canada’s market share has grown consistently since 2000, squeezing outflows from Mexico, Venezuela, and Colombia to account for 75% of U.S. imports of heavy crude oil in 2024.
According to the U.S. Energy Information Administration, U.S. imports of Canadian oil hit a new high of 4.42 million barrels per day in the week ending January 3, with almost 80% of Canada’s crude production going downstream to U.S. refiners.
Monika Morelli of Montreal canceled her subscriptions to Netflix and Amazon, two major American corporations, after US President Donald Trump threatened to impose heavy taxes on Canada. She also canceled a vacation to New Orleans that she had scheduled for later in the year.
“After centuries of the United States and Canada being allies, something has been irrevocably broken now,” Ms. Morelli, 39, told the media. She claimed that Trump’s comments that Canada would become the 51st US state and the threat of import fees “have made something snap in us all.”
Citing border security concerns, Trump had promised to impose a 25% tariff on Canada and Mexico this week. He then made an unexpected agreement with Mexico on Monday, agreeing to additional Mexican troops at the border in exchange for a 30-day deferral in the duties. Later in the day, he reached a similar agreement with Canada.
The delay was welcomed by Canadians, who had been extremely concerned about the tariffs’ economic effects. However, some believe the threat has strained ties between the US and Canada.
Although more than half still wished to try, 91% of Canadians want their country to rely less on the US in the future over mending the US-Canada relationship, according to data released on Wednesday by national pollster Angus Reid.
Ninety percent of Canadians were closely monitoring this topic, resembling participation levels not seen since the start of the Covid-19 outbreak, according to the opinion survey, which also noticed a significant increase in national pride.
Since the US is Canada’s biggest consumer, the tariffs might force the country into a recession and jeopardize thousands of jobs.
In addition to the tariffs, Trump has frequently (maybe in jest) said that Canada could join the US in order to avoid paying the tax. Many Canadians from all political backgrounds, however, have interpreted this statement as a challenge to their sovereignty, angering them.
