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Economy

In reply to the discussion: How do export duties work? [View all]

GreatGazoo

(4,152 posts)
5. Oil is a complex equation
Fri Jan 31, 2025, 09:23 PM
Jan 2025

Raising the cost of any source eg. via a tariff on Canadian oil, would cause a change in suppliers to a cheaper source.

The cost of oil (over simplified but still complex...) is the cost of extraction + the cost of transport to refinery + the cost of refining (varies with the quality of the crude) + cost of transport to end users.

Sweet light Texas crude is right next to US refineries and true to its name is fairly easy and inexpensive to refine. Brent is a notch or two more expensive to refine and has to be shipped from north England, and Tar Sands (Alberta) oil only pumps when prices are very high because it is very expensive to refine. Canada has better grades too but I'm just laying out the basic range of crude oil quality.

Transport is railcars and pipelines. A Congress critter who is very lucky in his stock picks recently bought CP (Canadian Pacific rail) in big quantities. It is a very boring stock. Range bound for 3 years or more, bouncing around between $70 and $84. Speculation is obvious that this Congress critter knows something, eg some reason why rail transport will be more profitable soon.

https://www.marketwatch.com/investing/stock/cp

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How do export duties work? [View all] Buzz cook Jan 2025 OP
US companies Cirsium Jan 2025 #1
Thanks. Buzz cook Jan 2025 #3
The importer pays the tariff. This additional cost is, of course, ultimately passed on to the LoisB Jan 2025 #2
Yes you're right. Buzz cook Jan 2025 #4
Oil is a complex equation GreatGazoo Jan 2025 #5
Rail JustAnotherGen Jan 2025 #8
If Canada prices itself out Buzz cook Jan 2025 #10
Trade Compliance Officer here JustAnotherGen Jan 2025 #6
Thank you very much. Buzz cook Jan 2025 #9
A very small manufacturer JustAnotherGen Jan 2025 #7
They are exploring the end of de minimis GreatGazoo Feb 2025 #11
I know JustAnotherGen Feb 2025 #12
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