If prices stay low, the US President Donald Trump said he could slap “very substantial tariffs” on oil imports. However, he does not expect the need to do that. As major producers Russia and Saudi Arabia boost output in a war over market share and as the coronavirus pandemic has hammered demand, oil prices have slumped by about two-thirds this year.
Donald Trump had previously said that he expects Saudi Arabia and Russia to reach a deal to cut oil production by as much as 15 million bpd. He expects tariffs can be avoided. Neither country has confirmed Trump’s comments.
In recent years, the US has become the world’s biggest oil producer, competing with Russia and the OPEC members. As oil prices plunge, workers are at risk of layoffs and many US energy companies face bankruptcies. The American Petroleum Institute and other energy interests oppose tariff as they are in fear the measures would add costs to importing crude and materials for refineries.
