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This is why Trump’s Canada-Mexico tariffs threaten a spike in gasoline prices - MarketWatch

1. U.S. oil imports from Canada may face 25% tariffs soon. 2. Canadian oil constitutes 60% of U.S. crude imports, critical for refineries. 3. Tariffs might disrupt the stable oil supply relationship between the U.S. and Canada. 4. BP’s refineries significantly rely on imported crude oil; any cost increase impacts earnings. 5. Potential regional price increases in the Midwest could affect BP's operations.

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FAQ

Why Bearish?

The proposed tariffs on Canadian imports could elevate BP's operational costs, impacting profitability. Historically, tariff implementations have led to immediate price volatility in raw materials and consequent refinery margins.

How important is it?

The proposed tariffs directly relate to the cost dynamics of BP’s key operations in refining, potentially creating unfavorable economic conditions.

Why Short Term?

Tariffs are likely to have immediate effects on crude oil pricing and operational costs. The potential increase in pump prices and regional adjustments will manifest quickly.

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