The oil industry is pushing back against President Trump’s tariffs on Chinese goods.
In comments obtained by the Washington Examiner, the American Petroleum Institute points out the dozens of energy products that the U.S. industry is reliant upon and could be subject to higher costs due to the tariffs.
“Increasing the costs of these imported products with tariffs will likely hurt energy growth and negatively impact jobs and investments,” read a letter submitted Friday night by the group to U.S. Trade Representative Robert Lighthizer.
The deadline is midnight for submitting comments either in support or refuting the 25 percent section 301 tariffs that Trump imposed recently on $50 billion of Chinese goods imported in the U.S. The American Petroleum Institute is the oil industry’s lead trade group in Washington.
These tariffs are separate from others Trump ordered on steel and aluminum about which the oil industry also has voiced concerns.
“Our member companies are currently in the process of finalizing analysis on the impact of Section 301 tariffs on their operations, but we are finding that there are a wide range of products used in the domestic energy industry that will be subject to these tariffs — including pumps, pump parts, motors, rotors/stators, valves, fluids, drill collars, lithium batteries along with various raw, semi-finished, and finished steel products,” according to the letter signed by Kyle Isakower, the group’s vice president for regulatory affairs.
Many products on the proposed tariff list are already subject to U.S. section 232 anti-dumping tariffs.
“As a result of the administration’s proposed action, at least 58 products crucial to the oil and natural gas industry would be subject to the … the Section 232 tariff and the Section 301 tariff, in addition to any other taxes and fees associated with the importation of these products,” the letter read.
In addition, the industry has identified more than 100 items on the tariff list used in the manufacture of oilfield equipment in the U.S. “Much of that equipment is deployed to support the ongoing resurgence of domestic oil and natural gas production, and the remainder is exported to the global oil and natural gas market,” Isakower wrote.
Isakower said the industry believes that sometime strict enforcement measures are warranted when it comes to trade, but “the breadth of the impact of the proposed Section 301 tariffs on our industry runs counter to the actions this Administration has taken to liberalize the development of domestic oil and natural gas resources and could restrict the capacity of the U.S. to enhance our energy security.”
In addition, the administration has failed “to account for the time needed to shift sourcing and supply chain would unduly harm our industry,” according to the letter.
“Similarly, the Administration’s proposal would risk disproportionate harm to the industry’s domestic manufacturing capacity if it does not account for other pertinent facts, such as the high U.S. content of many oilfield equipment imports from China, or the fact that many U.S. manufactured oilfield products are exported to foreign markets,” Isakower continued.
“Imposing tariffs on the U.S. content of imported goods or on U.S. exports runs counter to the Administration’s laudable intent to boost U.S. manufacturing,” the letter said.
