The new tariffs imposed by U.S. President Donald Trump on imports from Canada, Mexico, and China are likely to have a limited near-term impact on global oil and gas prices, Goldman Sachs said in a note on Sunday.
“Potential tariff-driven decline in U.S. natural gas imports from Canada is too small to significantly raise U.S. natural gas prices,” the bank said.
Oil and gas prices jumped on Monday after Trump imposed tariffs over the weekend.
The tariffs, which will take effect on Feb. 4, include a 25% levy on most goods from Mexico and Canada, with a 10% tariff on energy imports from Canada, and a 10% tariff on Chinese imports.
“Canadian oil producers are expected to eventually bear most of the burden of the tariff with a $3 to $4 a barrel wider-than-normal discount on Canadian crude given limited alternative export markets, with U.S. consumers of refined products bearing the remaining $2 to $3 a barrel burden,” the bank said.
Trump orders sweeping tariffs on Mexico, Canada, China
According to the note, seaborne oil imports from Canada and Mexico will be rerouted to other markets, with the U.S. replacing those supplies with crude from OPEC, Latin America, and refined products from Europe.
The investment bank kept its 2025/2026 oil price forecasts unchanged, expecting minimal near-term price impact due to stable global oil production and demand, as well as the Canadian oil tariff already being priced in.
Last week, Goldman Sachs raised Brent oil price forecast for this year and 2026 to $78 (versus $76 previously) and $73 (from $71), respectively.
Trump said he would talk with leaders of Canada and Mexico, which have announced retaliatory tariffs of their own, but downplayed expectations that they would change his mind.
In a separate note, Goldman Sachs analysts said that U.S. tariffs on Mexico and Canada will be short-lived.
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