An expert spoke about the negative consequences of the introduction of U.S. duties

The consequences of the US imposition of import duties on goods from Canada, Mexico and China may lead to contradictory effects on the global market. Igor Yushkov, an expert of the Financial University under the Government of the Russian Federation and a leading analyst of the National Energy Security Fund, told Izvestia on February 3.

Earlier, on February 1, US President Donald Trump signed a decree on the introduction of trade tariffs for goods from Canada, China and Mexico. He said it imposes a 25 percent tariff on imports from Mexico and Canada (10 percent on Canadian energy products) and an additional 10 percent tariff on China. This was done through the International Emergency International Economic Powers Act (IEEPA).

"Trump is giving conflicting signals to the market. Imposing duties on oil from Canada and Mexico, which are the largest suppliers to the US, is creating a deficit and pushing prices up," Yushkov said.

He said Canada, which is the main supplier of oil to the U.S., exports more than 100 million tons a year, but does not have enough infrastructure to divert those volumes to other countries.

"If Canada and Mexico decide to cut supplies to the US, they will not be able to quickly find alternative markets, which will aggravate the deficit and lead to further price increases," Yushkov explained.

According to the specialist, the imposition of duties on goods from China and threats to introduce similar measures against the European Union could slow down global trade. This means that the need for energy for the production and transportation of goods will decrease, which, in turn, could lead to a shortage of oil and make it more expensive.

"The trade wars that are now unfolding could slow the global economy and create instability in the oil market. Sharp price fluctuations are likely to await us in the coming months," Yushkov summarized.

Trump imposes duties against Canada, Mexico and China. What the media say

On February 1, Trump announced plans to impose 25 percent duties on imports from Canada and Mexico the day before. Later this decision was confirmed by White House press secretary Caroline Levitt.

As the American president pointed out, at the moment China, Canada and Mexico will not be able to do anything to prevent the impending imposition of duties. According to him, Canada is responsible for significant amounts of drug smuggling into the United States.

In response, Canadian Prime Minister Justin Trudeau said that the country has an equal, strong and reasonable response to Trump's imposition of duties. He specified that the Canadian side does not want to impose retaliatory measures against the US, while if the American side "takes this step", Canada will be forced to act.

Later, Chinese economist Andrew Leung told Izvestia that the tariffs imposed by Trump on imports of goods from China and Mexico will lead to an increase in consumer prices in the United States itself.