The New York Harbor spot refined products market, which has long depended on imports, has started off 2025 with uncertainty over whether the U.S. will impose tariffs that could force the region to look for alternative sources of supply.

President-elect Trump has promised to impose tariffs on Canada and Mexico and many market participants in the Northeast will be watching to see whether he makes good on the proposal and what effect that will have on market dynamics.

The East Coast (PADD 1) relies heavily on product imports from Canada, which over the first nine months of 2024, supplied the region with 29.508 million bbl, according to Energy Information Administration data.

Over that period, Canada was the third-largest exporter of finished gasoline to PADD 1, trailing only the Netherlands and Norway, EIA numbers showed.

EIA said Canada’s imports of finished motor gasoline into PADD 1 through September totaled 3.154 million bbl, or more than 14.5% of the total.

Canada led all exporters in sending jet fuel to PADD 1, accounting for 2.553 million bbl, or 43.4% of the region’s total imports in the first nine months of 2024.

Petroleum analyst Philip Verleger in early December said potential tariffs on Canadian and Mexican imports could increase the cost of crude oil from both countries by $16/bbl.

Irving Oil’s refinery in New Brunswick, Canada, and Valero Energy’s refinery in Quebec, which EIA said account for bulk of distillate and gasoline exports to PADD 1, would also be impacted by tariffs.

In addition, any tariff-related decline in Canadian gasoline exports to the U.S. could lead to higher shipments of Gulf Coast Products to the East Coast via Colonial Pipeline’s Line 1, a development that would likely increase the cost of moving fuel to the region.

Line space costs on Line 1 in 2024 peaked in mid-April at 12cts over tariffs and remained at a 10ct or more premium to tariffs for five straight days. For much of the fourth quarter, space on Line 1 was at a premium to pipeline tariffs.

East Coast market participants will also be watching to see whether the price of jet fuel in the Northeast will remain under pressure. Barge, Buckeye and offline Colonial spot jet fuel prices in late November fell to $2.1493/gal, down more than 90cts from where they were trading at the same time in 2023.

New York Harbor jet fuel in 2024 hit a peak of $2.92/gal on Feb. 9 at $2.92/gal, when it traded at a 3.5ct discount to the NYMEX. That was well below the 2023 peak of $5.64/gal reached on Jan. 26.

Spot jet fuel values in the Northeast did not fall below $2.10/gal in 2023, with the year’s low coming on May 4 at $2.13/gal. In 2024, prices slipped below $2/gal on three days, with a low of $1.98/gal coming on Sept. 10.

Market participants in the new year also will be keeping track of developments at the 650,000 b/d Dangote refinery in Nigeria. The new facility is working to produce gasoline and diesel that meets U.S. and EU specifications, but when that will happen is unclear.

One market participant said refining margins on gasoline could suffer if and when products from Dangote arrive. “That is what happens when complex refining grows at the rate that it has … with Dangote. The weak basic refiner gets squeezed,” he said.