The Topic Was Inflation I Believe. The Energy Report 04/03/2025

For those that told you that tariffs would add to inflation, they are finding out the reality may be exactly the opposite. Somehow the market was surprised that President Trump would have the courage to follow through with what he said he would do when it came to tariffs but once again, they underestimated the President and his resolve. And despite predictions that gas and oil prices would rise, we are instead seeing a big drop after a quick drop giving main street a price break just ahead of the summer driving season. While Wall Street frets and some worry about their 401-k, consumers will get the first positive impact from tariffs from cheaper prices at the gas pump.

President Trump imposed tariffs on various countries but exempted oil, gas, and refined product imports. This exemption reflects his commitment to keep energy prices low for Americans. By lifting domestic production restrictions and streamlining regulations, he aims to attract manufacturing companies to build or expand factories in the U.S., thereby creating higher-paying jobs for Americans.

Refiners got a gift from Canada as they rushed barrels to the US ahead of tariffs last week. That added to a whopping crude oil build that the market tried to dismiss until the tariff hammer fell. The EIA reported that U.S. commercial crude oil inventories increased by 6.2 million barrels from the previous week putting total supply at 439.8 million barrels and are about 4% below the five-year average for this time of year.

The EIA said that motor gasoline inventories decreased by 1.6 million barrels from last week and are 2% above the five-year average for this time of year. Distillate fuel inventories increased by 0.3 million barrels last week and are about 6% below the five-year average for this time of year.

Total product demand over the past four weeks averaged 20.1 million barrels per day, reflecting a 1.2% decrease compared to the same period last year. Motor gasoline supply averaged 8.8 million barrels per day over the past four weeks, a decrease of 1.9% from last year. Distillate fuel supply averaged 3.8 million barrels per day, an increase of 3.7%. Jet fuel supply was up 4.2% compared to the same period last year.

The band was weaker than it was a year ago has to be brought into questions because the Department of Energy had to upwardly revise their weekly demand numbers dramatically from the month before so we really believe that the demand numbers are better than what they showed in this week’s report we do think that some of the numbers were impacted by weather but we also need to get better data in the coming weeks we expect to see demand upwardly revised.

Although people are concerned about tariffs raising the cost of Chinese goods, lower prices at the pump will benefit consumers immediately. Wall Street may need to adjust to this new tariff environment, which could cause volatility for a while. However, this situation is likely to be beneficial for many companies and the US overall. We can expect a rebound in manufacturing jobs and more investment in the US in the coming months. President Trump’s actions regarding tariffs make sense when considering the tariffs other countries impose on the US.

President Trump displayed a chart comparing tariffs, showing that his tariffs were lower than those imposed by other countries on the US. By putting the facts in front of the American people and the world about how unfairly other countries have treated us made it much more difficult for the world to be outraged for Trump doing to them what they have been doing to us for decades.

President Trump has imposed a 10% tariff on all US imports, effective April 5. Importing companies will pay this tax. Some countries, including the United Kingdom, Singapore, Brazil, Australia, New Zealand, Turkey, Colombia, Argentina, El Salvador, United Arab Emirates, and Saudi Arabia, will only face the base rate.

The White House will impose reciprocal tariffs on around 60 countries that it believes undermine American economic goals. These countries charge higher tariffs on US goods, use non-tariff barriers, or act against US trade interests. The tariffs take effect on April 9th. The countries that made the Tariff List of Shame include key trading partners subject to these like the European Union: 20%; China: 54% (which includes earlier tariffs)Vietnam: 46% Thailand: 36% Japan: 24%  Cambodia: 49% South Africa: 30% Taiwan: 32%.

Despite the US stock market being affected, foreign markets may suffer more, giving the US an advantage. This should prevent the US market from declining too much. Oil prices are likely to find support as demand increases due to lower prices. The Green New Deal scam is still sinking the prospects for Europe’s economy. Bloomberg reports that, “The development of new oil and natural gas resources in the UK isn’t viable due to high taxes, according to Ineos Group. “Tax rates are so punitive that the UK is uninvestible,” Brian Gilvary, chairman of the Ineos Energy unit, said by phone on Wednesday following the company’s acquisition of production assets in the US. The UK introduced what’s known as the Energy Profits Levy in 2022, and the tax increased to 38% last year. Ineos, which has production in the UK, is paying a total tax rate of 78% on its output, according to Gilvary.” Now tack on Trumps Tariff.  Zero Hedge reported that Thailand will negotiate with the US on 36% tariffs.

Natural gas came back above $400 as winter wants to stay around. Fox Weather reported that, “A deadly tornado outbreak spawned more than 20 reports of twisters across the lower and mid-Mississippi Valley on Wednesday and Wednesday night. At least two people have died in Tennessee due to the severe weather, the state’s Department of Health confirmed early Thursday. The storms also injured multiple others and destroyed several homes from Arkansas, Missouri and Tennessee through Kentucky, Illinois and Indiana. A massive tornado was spotted by FOX Weather Storm Tracker Brandon Copic as it roared near Lake City, Arkansas. Authorities issued a Tornado Emergency – the most dire of tornado alerts – for towns in the path of the storm, such as Leachville and Monette.

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