Alberta premier rejects taxing oil exports, urges diplomacy with U.S.

Alberta Premier Danielle Smith is urging Canada to prioritize diplomacy over confrontation in its trade relationship with the United States, specifically rejecting calls to use the province's oil exports as leverage in ongoing disputes.

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Although I understand the need to respond strongly to these tariffs, I cannot think of a more disastrous policy decision than cutting off or taxing Alberta’s oil to the United States.

Smith cautioned against policies that would tax or cut off oil exports to the U.S., warning that such actions could lead to devastating retaliatory tariffs on Canadian energy products. She predicted that a 50 percent tariff on Alberta's daily oil exports could result in a 50 to 100 percent tariff from the U.S. on all oil and gas products, potentially costing at least half a million jobs, primarily in Alberta but also impacting Ontario and Quebec.

Instead of escalating the trade war, Smith advocates for Canada to "double down" on diplomatic efforts. She believes that threats and promises Canada cannot keep are counterproductive. "We need to be wise, patient, careful and deliberate to overcome the economic attacks our country is facing," Smith stated, emphasizing a focus on controllable actions rather than aggressive posturing.

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This would result in the loss of about half a million jobs at a minimum, mostly in Alberta, but also hundreds of thousands of jobs in Ontario and Quebec.

Alberta's oil and gas exports to the U.S. have thus far avoided the tariffs imposed by the Trump administration. Provincial statistics indicate that these exports are valued at nearly $111 billion for 2025, representing a substantial portion of the province's total global exports. Smith expressed concern that American refineries might switch to sourcing oil from Venezuela if Canadian supplies were cut off, further complicating the situation.

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The United States would, of course, respond and cut off all gasoline and diesel from their refineries to Ontario and Quebec, right as we turn into fall and winter.

Smith also highlighted the upcoming U.S. midterm elections as a potential moment for Canada to influence the agenda, suggesting that a shift in congressional control could empower Democrats to block President Trump's initiatives. She believes Canada should leverage this period strategically, focusing on constructive engagement rather than escalating tensions.

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We need to be wise, patient, careful and deliberate to overcome the economic attacks our country is facing.