Sky News economics and data editor Ed Conway has produced another short and information filled segment looking at how the U.S. become the biggest oil producer in the world. Well worth the 5-minutes and helps to contextualize many of the geopolitical shifts currently underway. WATCH:
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When you factor in the U.S. control over Venezuela oil production, well, things look even stronger.
I never quite understood just how controlled the information flow is inside Canada until about two years ago when we began closely monitoring Canadian positioning for the upcoming USMCA (CUSMA) renegotiation/cancellation. It quickly became obvious the majority of Canadians have no idea why it is almost a certainty the U.S. would exit the trilateral arrangement and position for a bilateral free trade agreement.
In the two years that have passed, now we see a few Canadians starting to realize the core issues of trade conflict that make any FTA between the U.S. and Canada almost impossible. The largest issue centers around Canada’s net-zero carbon legislation that now completely disconnects them from aligned North American energy policy between the U.S. and Mexico.
A trilateral agreement requires core alignment on industrial manufacturing, and that requires similar abilities & similar energy policy. You cannot make steel, iron and aluminum without coal and gas. You need joules for heavy industrial manufacturing that cannot be achieved without exploiting coal, gas or oil (carbon materials). Canada’s energy policy no longer aligns with industrial manufacturing. This core issue cannot be resolved at the current level of energy policy in Canada.
There are other issues like Canadian trade deals with China, non-tariff barriers, legislated rules over intellectual property and other points of significant friction that make alignment within North America challenging. However, the energy component makes compatible trade impossible.
In the interview below, U.S. Ambassador to Canada Pete Hoekstra appears on a podcast with David Leis, for a blunt conversation about trade, pipelines, critical minerals, China, and why the U.S. is growing frustrated with Canada’s direction. At the end Hoekstra even explains why he is doing Canadian podcasts; because information within Canada is restricted by the government control of media – and that explains why most Canadians are clueless about the issues.
I’ve prompted the interview to the point that gets into the details. If you are interested to be fully understanding of what is coming, this is a solid reference point. Also, if you have financial investments associated with Canada or any system that is connected to the economic relationship between the U.S. and Canada, you need to watch this interview to proactively defend your financial interests. VIDEO PROMPTED:
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Watch it or listen to this roughly 30 minutes (prompted) as you cook, drive or go about your day. But listen to it and see the disconnect between Canada and the USA as outlined. Things are going to get much worse in this relationship as the finality of it all suddenly starts to sink in north of the border with the average Canadian.
For almost two decades Europe has been investing heavily inside Mexico, particularly noted in the auto industry, as they positioned themselves to take advantage of NAFTA and later the USMCA as an entry to the U.S. market.
European auto companies spent billions on assembly plants in Mexico, where they could ship EU manufactured component goods to be assembled into NAFTA/USMCA compliant vehicles. As President Trump and USTR Greer begin focusing on eliminating the USMCA trade agreement in favor of two bilateral deals (U.S-Canada and U.S-Mexico), Europe now needs to protect prior investment.
The prior Mexico-EU trade agreement has existed since 2000 (NAFTA timeframe). In 2025 they agreed to a revised Free Trade Agreement (FTA) and finalized the terms and conditions yesterday.
MEXICO CITY, May 22 (Reuters) – Mexico and the European Union signed a long-stalled free trade agreement on Friday as they seek to decrease dependence on the U.S. and partially insulate themselves from U.S. President Donald Trump’s tariffs.
The accord, which they reached broad agreement on in 2025 but have delayed signing, expands a Mexico-EU trade accord from 2000, which covered only industrial goods. The new pact adds services, government procurement, digital trade, investment and farm produce.
Mexico’s President Claudia Sheinbaum, European Commission President Ursula von der Leyen and European Council President Antonio Costa are to sign the deal in Mexico City in their first summit in over a decade.
This is not good news for Canada who appears to be hoping that leftists in congress will support the Canadian position on retention of the USMCA trade deal. However, the position of the United Auto Workers and their President Shawn Fain works perfectly with the position of President Trump and U.S. Trade Representative Jamieson Greer.
The UAW leadership supported Kamala Harris in 2024, and they carry a lot of sway with Democrats in congress. In fact, it is entirely possible the 20 Democrat Senators who wrote a letter to USTR Greer about getting tough on Mexico and Canada, may have been responding directly to what UAW President Shawn Fain is demanding.
The UAW rank and file align with President Trump and their leadership, despite their roots of alignment with Democrats, support the trade tariff approach by President Trump. All of that nuanced interest now begins to assemble quickly, and the political leverage plan of Canadian Prime Minister Mark Carney looks weaker by the day.
Wall Street Journal – As North America’s trade treaty approaches renewal or renegotiation this summer, United Auto Workers President Shawn Fain slammed the deal and called on the U.S. to upend it—or scrap it altogether.
Fain’s position pits the 400,000-member union against both the American and foreign-based automakers that are calling on the U.S. to preserve the U.S.-Mexico-Canada trade treaty, or USMCA.
[…] Fain blamed USMCA and its predecessor, the North American Free Trade Agreement, for the loss of millions of American auto manufacturing jobs over the last several decades.
“Where it didn’t eliminate jobs entirely, it slashed wages and benefits,” said Fain, wearing a “Kill NAFTA” T-shirt on a video call. “There is no future for the U.S. working class that doesn’t address the free-trade disaster.”
According to the latest media reports, Prime Minister Mark Carney is set to announce a new Canadian Trade Advisory Council that will strategize the best moves within each sector of the Canadian economy to deal with the United States USMCA renegotiations. Even at this latest date, the Canadian government is still under the belief they can negotiate themselves into a position where their status within the USMCA (CUSMA) will be retained.
Simultaneous to this announcement, the one best hope the Canadians have relied upon is also evaporating. However, before discussing that aspect, let’s first look at the advisory council.
CANADA – Prime Minister Mark Carney is expected to unveil a new advisory council focused on Canada-US trade relations as Ottawa attempts to salvage Canadian-US trade amidst Donald Trump’s aggressive tariffs. According to reports, the council will bring together major business leaders, labour representatives and former politicians to advise the federal government ahead of the scheduled review of the Canada-United States-Mexico Agreement (CUSMA).
[…] While the entire list of figures present on the council has yet to be announced, the Government of Canada first announced the advisory committee in April 2026, and released a partial list of members. Members reportedly include Conservative leader Erin O’Toole, former Quebec premier Jean Charest, and other representatives from sectors such as energy, manufacturing and forestry. There are also multiple high-level Canadian executives present on the list released by the Prime Minister’s office on April 21. The committee will be chaired by Dominic LeBlanc, who currently serves as minister responsible for Canada-U.S. trade and intergovernmental affairs. According to the Prime Minister’s Office, the council’s role will be to provide strategic advice and industry expertise as Canada prepares for negotiations under the umbrella of Donald Trump’s renewed tariff threats.
Remarkably, many news articles are citing confusion in trying to understand why U.S. Undersecretary of War, Elbridge Colby, announced the suspension of U.S. participation in the Permanent Joint Board on Defense with Canada. However, the announcement comes immediately after his meeting with U.S. ambassador to Canada, Pete Hoekstra, at the Pentagon and the comment, “we’re working closely to ensure every NATO partner, including Canada, reaches the Hague Summit’s 3.5% GDP defense spending target, a vital investment for North American and Arctic defense.”
The issue, as outlined by Undersecretary Colby, centers around Prime Minister Mark Carney’s recent statements in antagonism toward the U.S., a public announcement that Canada would not be purchasing U.S. military equipment and the biggest issue of all, that Canada is not living up to the NATO defense spending agreements.
It was in December of 2024, immediately after the November election where Donald Trump won, when then Prime Minister Justin Trudeau flew to Mar-a-Lago for dinner with President Trump and told him there’s no way that Canada could meet their NATO obligations. Canada had relied on the USA to provide all national defense and was 16th in defense spending at 1.1% of GDP. {CITATION}
The issue of NATO compliance was part of a larger discussion around trade imbalances, non-tariff barriers, intellectual property conflicts and legislative hurdles that Canada used as a crutch to retain economic benefit without reciprocity.
Trudeau was arguing that Canada could not change all the points of conflict, drop their non-tariff barriers, comply with NATO demands and simultaneously get into total alignment with the USMCA trade compact (CUSMA to Canada), because their climate policies did not support or match the heavy industrial processing capabilities of both the United States and Mexico.
This triggered President Trump to respond with the 51st state, notation. Essentially, if you cannot be a partner with equal capabilities; and if you need to retain structural economic dependency; then Canada should just become a 51st state of the USA.
Since that time, things went downhill quickly. Instead of trying to find ways to eliminate points of conflict, Prime Minister Mark Carney began a campaign of aggressive anti-Trump narrative distribution in order to maximize domestic political benefits.
President Trump then turned toward Mexico and began working with USTR Jamieson Greer to construct what is essentially a bilateral trade agreement between the U.S. and Mexico.
The administration began ignoring Canada, planning instead to announce the upcoming dissolution of the USMCA and then force Canada to negotiate a bilateral. A jilted Canada then began doubling and tripling down on the anti-Trumpism, with Carney saying the era of trade between the USA and Canada is over.
Carney then reached out to Europe and China for trade replacement value and began making announcements about no longer purchasing U.S. manufactured fighter jets and military hardware.
U.S. Undersecretary of War, Elbridge Colby meets with U.S. Ambassador to Canada, Pete Hoekstra, and obviously the NATO stuff is just the straw that ended the U.S. participation in the Permanent Joint Board on Defense with Canada. Not a complicated timeline to figure out.
I’m not going to spend too much time on this as I suspect most readers are well aware of my predictions on the matter. Suffice to say Treasury Secretary Scott Bessent and the Office of Foreign Assets Control (OFAC) has extended the sanctions waiver on Russian oil and gas for another 30-days. {citation}
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The OFAC waiver targets Russian oil/gas that was loaded onto floating storage platforms as of April 17, 2026. The destination of the oil/gas will primarily be China, India and Southeast Asia; westbound Arctic supply route. The general license means all of the ASEAN countries can purchase in dollars and provides Russia with an exchange for the same currency valuation. Once again, Zelenskyy -and Europe- will not be happy.
There is a certain irony in Europe previously banning the import of Russian oil/gas (EU sanctions) and now, when they desperately need it, the supply is flowing in the opposite direction. Both Russia’s Arctic I and Arctic II platforms are operating to produce the supply; however, as many readers here will note they coincidentally :::nudge, nudge – wink, wink::: started pumping supply to “on the water” storage for six months prior to the beginning of the Iran conflict. This is the third U.S. waiver of sanctions.
Russian Federation President Vladimir Putin is scheduled to arrive in Beijing on Wednesday. {GO DEEP}
U.S. Trade Representative Jamieson Greer appears on CBS Face the Nation to discuss current U.S-China trade relations on the heels of the recent Beijing summit. Brennan in her customary passive-aggressive mode as a professional narrative engineer. Video and Transcript Below:
[Transcript] – MARGARET BRENNAN: We begin this morning with a top member of the president’s economic team, United States Trade Representative Jamieson Greer. Good morning to you, Ambassador.
JAMIESON GREER: Good morning. Good to be here.
MARGARET BRENNAN: It isn’t just a matter of sentiment. Gas is at an average of $4.51 a gallon. Americans have spent $45 billion more on fuel since the war began versus a year ago. The stock market is up, but lower-income Americans are pulling back on their spending. The New York Fed reports households earning less than $125,000 a year are fueling up their cars less often. How do you provide relief to the average American?
JAMIESON GREER: Well, we know that no one wants to see higher gas prices. At the same time, the president is balancing foreign policy considerations. We know that, in addition to wanting to have low gas prices, we don’t want our children or grandchildren to inherit a world where Iran has a nuclear weapon, so the president is focused on affordability in as many ways that he can- that he can. He’s bringing jobs back to America. We’re focused on getting wages up to offset any kind of increase in prices, and we’re seeing prices go down for staples like dairy, cheese, flour, etc. So we’re very focused on this. The president’s focused on it, and we look forward to seeing those prices come down soon as the operations wrap up in the Gulf.
It was reported yesterday that Mexican President Claudia Sheinbaum and U.S. President Donald Trump had a cordial conversation about ongoing trade and security discussions. {link} The phone call likely took place as President Trump was aboard Airforce One returning from China.
Previous to this phone call, “Gerardo Mérida, a retired Mexican army general who served as public-security secretary in northwestern Sinaloa state, was detained on Monday in Tucson, Ariz., court records show. Mérida is one of 10 current and former Sinaloa officials, including Gov. Rubén Rocha, indicted last month in the U.S. for allegedly taking bribes from Sinaloa cartel leaders to protect their billion-dollar drug empire. U.S. prosecutors say that the Sinaloa cartel is one of the world’s top producers and smugglers of fentanyl into the U.S.” {link}
The Trump administration is not slowing down on the intention to remove Mexican drug and human smuggling cartels, despite the reported domestic protestations from within the Mexican government. There appears to be a rather unusual dynamic at play.
Inside Mexico the federal government is publicly criticizing the U.S. position; however, simultaneously Mexican President Sheinbaum is promoting a working relationship with President Trump and the U.S. position.
According to the New York Times, Acting Attorney General Todd Blanche has now shifted the prosecutorial focus to charge the designated Mexican cartel targets as terrorists.
U.S. Trade Representative Jamieson Greer gives a broad overview of the current status of U.S. trade relations with China on the heels of the Beijing Summit. Greer notes that China has agreed to fulfill all previous purchase agreements and the future of trade between the U.S. and China looks very stable.
Additionally, China has made major purchases for 200 Boeing aircraft and up to 500 jet engines that are worth multi-billions in benefit within the manufacturing sector for the United States. Following the conflict points between the U.S. and Europe, specifically as it relates to outcomes from the military engagement in Iran and the weakening of selfishly motivated NATO alliance members, China does appear to be more open in their trade relations with the USA. Perhaps this is driven by the new paradigm of energy dependency that Beijing is not familiar with.
The most interesting aspect to the Beijing trip was not and is not the trade success stories that surfaced during the trip {USTR Greer}. While President Trump brought titans of industry, tech and finance with him to Beijing, the emphasis was on relationships.
Perhaps President Trump was teaching those influential peers something akin to needing a perspective change. Perhaps the nature of trade relations is so structurally under change, all those business interests within it need to look at things differently.