What's the Tariff on Crude Oil?
Canadian crude oil faces 10% IEEPA tariff.
Current Tariff Rate
10%
Pre-2025 Rate
0%
Rate Increase
+10pp
Price Impact
+10%
+$7
Real-World Price Impact
Before Tariffs
$70
Barrel of oil
After Tariffs
$77
Barrel of oil
That's $7 more per unit — a 10% price increase paid by the American buyer.
Note: Price estimates assume full tariff pass-through to consumers. Actual retail prices may vary — manufacturers may absorb some costs, shift production, or adjust margins.
The Story Behind This Tariff
The 10% IEEPA tariff on Canadian crude oil strikes at the heart of North American energy integration built over five decades. Canada is America's largest oil supplier by far, providing 3.9 million barrels per day — roughly 60% of all US crude imports. The infrastructure is deeply embedded: the Keystone pipeline system, Enbridge Line 5, and dozens of smaller pipelines physically connect Alberta's oil sands to Midwest refineries specifically designed to process heavy Canadian crude. These refineries in Illinois, Michigan, and Oklahoma cannot easily switch to lighter domestic shale oil without billions in reconfiguration. The tariff functions as a direct tax on gasoline for Midwest consumers, with estimates suggesting a 10-15 cent per gallon increase at the pump. Paradoxically, the tariff also undermines US energy security by incentivizing Canada to accelerate the Trans Mountain pipeline expansion to ship oil to Asian markets instead.
📦 Supply Chain
Primary Origin
Canada
Made in USA
60%
Import Volume
09B
Alternatives
Domestic shale (different grade), Saudi Arabia, Mexico
📅 Tariff Timeline
1988
Canada-US FTA eliminates energy tariffs
0%1994
NAFTA energy provisions deepen integration
0%2020
USMCA maintains duty-free energy trade
0%2025-Feb
IEEPA tariff on Canadian energy — first in 37 years
10%👥 Consumer Impact
Households Affected
130M
Annual Cost Per Household
80
💡 Did You Know?
- •Canada supplies 60% of all US crude oil imports — more than the next 5 countries combined
- •Midwest refineries spent 0+ billion over decades retooling specifically for heavy Canadian crude and cannot easily switch feedstocks
- •The tariff could push Canada to accelerate Pacific pipeline exports to China, permanently redirecting oil away from the US
Tariff Details
- HTS Code
- 2709.00
- Current Rate
- 10%
- Pre-2025 Rate
- 0%
- Tariff Type
- IEEPA (Canadian energy)
Legal Authority
IEEPA (Canadian energy)
Effective: 2025
Tariff imposed under presidential trade authority
The tariff on Crude Oil is paid by the American importer at the port of entry and passed through to consumers as higher retail prices. The foreign manufacturer does not pay the tariff.
Who Actually Pays This Tariff?
Despite claims that tariffs are paid by foreign countries, the 10% tariff on Crude Oil is paid by American importers — US companies that purchase these goods from abroad. The cost is then passed to American consumers through higher retail prices.
- ✓ The foreign seller receives the same price as before
- ✓ The US importer pays 10% of the customs value to CBP
- ✓ The retailer marks up the higher landed cost
- ✓ You pay more at the register: $70 → $77
Related Products in Raw Materials
🔍 Dig Deeper
See the Full Picture
Tariffs affect thousands of products. See how much they're costing your household.