White House Exempts Some Energy Products From New Import Tax
The Trump administration is exempting a number of energy-related items from its sweeping list of tariffs on imports, but that did not stop oil markets from crumbling early Thursday in response to the president's tariff announcement.
Imports of liquefied natural gas, crude oil from Canada, electricity and materials needed for making petrochemicals are all exempt, according to a list the White House made available Thursday.
The oil industry cheered the exemptions, though they were not enough to offset a general fall in commodity and company share prices as the market reacted to the tariffs.
The exemption for "oil from bituminous minerals" would apply to crude from the oil sands in Canada, the largest foreign supplier of oil to the United States.
The carve-out for electricity imports would mostly help Northeast states that depend on power generated in Canada, which had become a major point of contention as the premier of Ontario promised to push back.
While the United States is the world's largest LNG exporter, Massachusetts and other states occasionally import cargoes, according to the U.S. Energy Information Administration.
“Very positive that the President continues to protect the vital energy imports from our North American trading partners that help keep energy costs affordable for American consumers,” one oil industry executive said via text when asked about the tariffs.
The price of domestic oil benchmark West Texas Intermediate fell $5 in early trading Thursday after Trump said the United States would put a minimum of a 10 percent tax on imports from most countries and higher rates for a group of other countries, including a a 54 percent tax levied on goods from China. The Dow Jones U.S. Oil & Gas Index, which measures performance of 42 companies in the sector, fell more than 6 percent in early trading.
Adding to the drop in oil prices, OPEC+ — the oil-producing countries of OPEC and its partner Russia — decided Thursday to go ahead with increasing their production in a bid to grab market share, said Nikos Tzabouras, market analyst at stock trading platform Tradu.com.
“The OPEC+ announcement has intensified the sell-off triggered by reciprocal tariffs, putting WTI at risk of fresh 2025 lows,” Tzabouras said in an analyst note. “If this shift in priorities materialises, the implications for the oil market could be profound, potentially leading to a prolonged period of lower prices.”