The trade deficit with Canada that’s upset Trump so much is due to crude the U.S. buys at a discount for the Midwest. ‘It’s the only oil they can use’
“They can’t use Texas crude. They can’t use Venezuelan crude. They’re not set up for it. It would take years and billions of dollars to shift over.’’
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# Summary The U.S. trade deficit with Canada is largely driven by crude oil imports to the Midwest, where refineries are specifically configured to process Canadian crude at a discount and cannot economically switch to alternative sources like Texas or Venezuelan oil without years of costly infrastructure retrofitting. This structural dependence means U.S. refiners will likely continue purchasing Canadian crude regardless of trade policy pressures, supporting Canadian energy exports and limiting Trump's leverage on the bilateral trade balance.
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