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Canada; the economy says otherwise “WE DON'T NEED CANADA, THEY NEED US!” Trump posted this week, repeating his
long-running claim By AP- PTI Updated - August 27, 2026 at 09:59 AM. | Toronto
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US President Donald Trump | Photo Credit: REUTERS US President Donald Trump says his country does not need Canada. But
every day, roughly 4 million barrels of Canadian crude oil flow south, helping fuel American cars, trucks and airplanes
and supply US industry.And oil is only the beginning.Canada also supplies aluminum, potash to US farms and parts for an
auto industry built on both sides of the border.“WE DON'T NEED CANADA, THEY NEED US!” Trump posted this week,
repeating his long-running claim.Yet Trump has imposed a 50% tariff on Canadian aluminum while acknowledging this week
that the United States badly needs the metal.“This country desperately needs aluminum,” Trump said. “We don't
have it. We get it all from Canada for the most part, and we need it badly.” The contradiction underscores how deeply
the two economies remain intertwined -- and how much could be at stake if Trump's trade war reaches more of the
energy, materials and supply chains that the US still relies on Canada to provide.Canada fuels American industryCanada
is the United States' second-largest trading partner after Mexico and energy is at the heart of that
relationship.The two countries exchanged about $872 billion in goods and services last year. Canadian crude imports
equal nearly 20 per cent of total US petroleum consumption, according to the US Energy Information Administration, part
of the Department of Energy.Daniel Béland, a political science professor at McGill University, said Trump's claim
that the United States does not need Canada is “absolutely false,” citing US reliance on Canadian oil and natural
gas and deeply integrated industries such as autos.Much of Canada's crude flows to Midwest refineries built to
process its heavy oil into gasoline, diesel and jet fuel.Energy also explains much of the US trade deficit with Canada,
which Trump frequently cites as evidence of an unfair relationship.The White House this week portrayed the relationship
in starkly negative terms, saying Canada had taken roughly $50 billion a year from the United States over the past
decade. Much of that gap reflects US purchases of Canadian energy, which helps power the US economy. And Canada's
heavy crude typically trades at a discount to US benchmark oil, according to the US Energy Information
Administration.Energy more than accounted for last year's $48.3 billion goods deficit. Without energy, the United
States would have run a trade surplus.After trade talks collapsed last Friday, the US imposed 50 per cent tariffs on
about $20 billion worth of Canadian goods. The measures cover only about 5 per cent of Canadian exports to the United
States and exclude energy.Canadian politicians debate using energy exports as leverageFor now, using oil as a weapon in
trade negotiations remains a remote possibility. Alberta Premier Danielle Smith opposes restricting energy exports,
arguing that doing so would hurt her province.But former Alberta Premier Jason Kenney said Canada should not rule out
export taxes on oil, fuel or potash if Trump escalates further.Such retaliation “would affect Republicans who drive
F-150s and lay fertilizer on their farm fields,” Kenney said.“They should be mindful that if they really want to
escalate, it will not end well for the American economy two months before midterm elections,” he said.Ontario Premier
Doug Ford cited Canadian commodities as leverage, accusing Trump of “putting out fake news” about the United States
not needing Canada. He called potash used by US farmers “one of the most powerful tools we have” and said Washington
would have to turn to suppliers such as Russia if Canada redirected shipments.Saskatchewan Premier Scott Moe rejected
that approach, saying his province “cannot and will not support” export tariffs on resources. He said Saskatchewan
is on track to supply about half the world's potash and warned that taxing exports could cost Canadian jobs, raise
fertilizer prices and push US buyers toward suppliers such as Belarus.“This would be a tremendously flawed policy on
behalf of Canadians,” Moe said.Moe has backed a more targeted retaliation, saying Saskatchewan will impose a 50 per
cent reciprocal charge on US alcohol beginning Sept. 8 after initially being one of only two provinces that kept
American alcohol on store shelves.Kenney stopped short of advocating an export tax on oil, and Béland said such a move
would probably be “a very divisive issue politically in provinces like Alberta and Saskatchewan.” That underscores
the limits of Canada's leverage: measures aimed at hurting US industries could also hurt Canadian producers and
strain political unity at home.From pickup trucks to farm fieldsCanada has long been the dominant foreign source of
aluminum for the United States. Smelting the metal requires enormous amounts of electricity, giving hydro-rich Canada a
major advantage.Prime Minister Mark Carney told a New York business audience in May that Canadian aluminum exports to
the US are “the energy equivalent of 10 Hoover dams.” American farmers are even more dependent on Canada for potash,
a fertilizer essential to crops such as corn and soybeans. More than 80 per cent of US potash imports come from
Canada.Even Trump's ambassador has disputed the idea that the United States needs nothing from its
neighbor.“America has a tremendous amount of things where we have a need,” Ambassador Pete Hoekstra said in June.
Pointing to Canadian fertilizer supplies, he added: “We need potash.” Then there are cars.Canada and the United
States have built an integrated auto industry in which parts can cross the border up to six times before final assembly,
according to the Canadian government.Trump said Monday that his administration would impose 50 per cent tariffs on
Canadian cars, trucks and auto parts starting Jan 1, 2027 -- after the November midterm elections.That means a tariff
aimed at Canada can land in Michigan or Ohio. Tax Canadian aluminum and an American automaker may pay more for metal.
Tax Canadian parts and the cost of assembling an American vehicle can rise.AI needs power. Canada has itArtificial
intelligence is driving a surge in electricity demand. Canada supplied 85 per cent of US electricity imports in 2023,
according to the Canada Energy Regulator, and Carney says the country needs to double the capacity of its electricity
grid by 2050 through major hydroelectric and nuclear projects.Carney said Canada could help the United States “meet
exploding demand to power AI." Comments Published on August 27, 2026 READ MORETHIS AD SUPPORTS OUR JOURNALISM.
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