Mr. Trump has promoted that “Drill Baby Drill” will solve all the inflation problems. It will not work, and like egg prices, the price of gasoline at the pump will explode.
A FIGHT OVER OIL
Who would have thought that two old-time friends would be in such a fight? Canada and the USA are now locked in a battle over oil because of Trump’s tariffs. This isn't just a disagreement but an all-out drag-em-down fight that could develop into a crisis that affects the entire world.
CANADA: AMERICA’S TOP OIL SUPPLIER
The USA could lose a valuable, steady trading partner and a constant oil supply. Canada has been the United States' most significant oil supplier for decades, and it is at the brink, which cannot be replaced by Drill Baby Drill.
HOW MUCH OIL DOES CANADA PROVIDE?
Canada provides over 60% of the US oil needs, and Drill Baby Drill will not fix the loss of a good friend and their oil.
WHY “DRILL BABY DRILL” WILL NOT WORK
Canadian oil comes from Canada's oil sands, which contain thick, heavy crude oil that requires special processing. This type of oil suits many US refineries, but due to the type of oil in the US ground, Drill Baby Drill will not work to replace the lower oil flow from Canada affected by tariffs for several reasons.
First, the complexity of energy markets means that domestic production cannot simply fill the gap left by Canadian oil. The U.S. and Canada have different oil types that serve varying needs; U.S. refineries are optimized for specific crude oil blends, and the sudden removal of a major supplier like Canada can’t be offset merely by ramping up U.S. production.
Second, the time frame for increased drilling and production is often underestimated. New oil projects require significant investment, regulatory approval, and substantial lead time to become operational. Even if drilling permits are expedited, it can take years before new production can adequately compensate for lost imports.
Third, there are also market forces that are continually in play. Price, production, supply from other countries and many other factors dictate what companies in the USA want to do. There is a history of US companies ignoring these issues and facing mass bankruptcy. US companies will not make this mistake again.
WHY THE U.S. OIL CAN NOT EASILY REPLACE CANADIAN OIL
Mr. Trump suggests that “Drill Baby Drill” is the answer, but it is not. For two reasons:
The U.S. is already drilling, baby. Oil production is the highest it has ever been, with the USA leading the world in production. As explained above, increasing production significantly is easy to say but challenging to do.
Some people think the US could just produce more oil to compensate for the loss of Canadian crude. However, besides the challenges listed above, there is a problem with the type of oil.
Much of the oil produced in the US is "light" oil, while many American refineries are built to process Canada's heavier oil. Switching refineries to use light crude oil would take years and cost billions of dollars. It's like trying to fit a square peg in a round hole.
Drill, baby drill will not work. It will not keep prices in check because of shortages.
THE IMPACT ON GAS PRICES
It would be a disaster if Canada stopped supplying oil to the U.S. As supply is squeezed, gas prices in the U.S. would jump. Some suggest gasoline could jump to $7 or even $9 a gallon!
This would mean much higher costs for everything—groceries, clothes, and even getting to school or work. Trucks that deliver goods across the country rely on diesel fuel, which would also become much more costly. Because of the increased transportation costs, the prices of almost everything would skyrocket.
If you need an example, look at egg prices. Shortages have caused prices to more than double in many cases. Just wait until that happens with oil shortages.
LOSS OF CANADA’S OIL TO THE U.S.
The impact of the U.S. oil tariff crisis isn't just about Canada and the United States. It’s a global issue. Like the United States, Canada is a major oil supplier to the world. If its oil isn't going to the US, other countries will want to buy it.
Watch what happens to U.S. oil prices when, because of an illogical fight with a friend, kicking Canada in the teeth, supply goes elsewhere and does not quickly return to the U.S.
CANADA FIGHTS BACK
Canada is not a “happy camper.” The citizenry cannot understand Mr. Trump’s logic behind this and is speaking out hard. “Buy Canadian” is in the forefront, and politicians from all stripes are following suit.
Canada has threatened to stop sending oil to the United States altogether, and this is not an empty threat. Canada has other places to sell its oil, like Europe, China, and India. These countries are eager to buy, and with the Canadian sentiment, U.S. access to much-needed Canadian oil is being eroded, if not lost.
WHAT HAPPENS NEXT?
Some in the U.S. have suggested that the future is uncertain. That is not correct. If Mr. Trump continues with his oil tariffs, the future is inevitable. The string gets stretched daily, and Canada’s respect for the USA as a valuable friend and business partner is at the breaking point.
The population is working hard to “Buy Canadian,” and heavy crude oil will be heading to new markets. Those two things alone will have a huge and negative impact on the United States' population.
WHAT HAPPENS NEXT?
US markets in Canada will be eroded; US jobs will be lost.
Heavy oil to supply the U.S will be lost as Canadian production is directed to other willing partners around the world. Gas prices and the price of everything in your grocery store will go up.
CONCLUSION
The fight between the U.S. and Canada over Canada’s oil is a big problem and at a critical point. The U.S. relies heavily on Canada for oil, but Mr. Trump’s tariffs ARE stretching the string to the breaking point.
Without Canada’s oil, the U.S. will be in deep trouble. It is not as easy as Mr. Trump says, “Drill, Baby, Drill.” The US refineries require heavy oil supplied by Canada, which cannot be replaced with light crude oil, which is prevalent in the USA. In short, one cannot be switched in the refineries with the other.
In conclusion, the consequences will be hard and long-term. Just look at what has happened to the price of eggs due to a shortage of supply; the same impact is coming with U.S. fuel prices. With that, the prices of everything will go up.
@openyourojos and all who voted for Mr. Trump, is this what you voted for? But this is now what you have got. Is this making America great again and you happy?
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