Protecting US steel could get ugly for US oil.
Assuming President Trump's proposed import tariff on steel (25%) is enacted, one consequence could be a significant impost on the US shale industry.
This is because the great majority of steel used in US oil pipelines is imported. Given tariffs will not result in an overnight resurrection of the US steel industry, these imports will continue for some time and would cost an extra 25%, post-tariff.
Liam Denning of Bloomberg's Gadfly suggests that if these higher costs were to be passed on from US pipeline owners to oil and gas producers, the cost per barrel of US shale oil would increase. This in turn would provide a massive free kick to Russia and OPEC because the price of oil would be able to float higher before shale producers would be financially incentivised to turn on production.
Let's not forget about the proposed float of Saudi Aramco - the oil price effect of the proposed tariff could add some serious rocket fuel to its aspirational $2 trillion valuation, which is likely to be a key driver of IPO timing.
Other industries with a heavy usage of imported steel and/or aluminium (10% tariff) are not immune - check out Boeing - it's stock price has suffered since the announcement.
Then again, perhaps it's a White House poker chip in a larger negotiation or maybe it will not get enacted. But if this blunt instrument does make it through, a return to volatility across commodities, equities and currencies is highly likely - with the net effect on China's demand for Australian iron ore, ambiguous.
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