博彩对冲

The Issue

Trump has invented a novel form of economic statecraft, threatening "secondary tariffs" on imports from countries to achieve foreign policy objectives. The idea is analogous to secondary sanctions, which target third-country entities that violate US sanctions on foreign persons or entities. But experts question how such tariffs would work in practice. For example, China is the main target, but the threat against it is moot given already sky-high US tariffs on Chinese goods. India, a key Russian crude buyer, could prove more sensitive, however.

Threat Posturing

Trump likes to tout secondary tariffs, but it鈥檚 unclear in practice how they would function or whether they will be implemented. The first salvo came in an executive order last month targeting buyers of Venezuelan crude with tariffs of 25%. Trump has also threatened secondary tariffs of 25%-50% on buyers of Russian crude if the Kremlin drags its feet on negotiations to end the Ukraine war. In Congress, a bipartisan group of 50 senators has also introduced legislation that would impose a whopping 500% tariff on goods imported to the US from countries that buy Russian oil, gas, uranium and other products if the Kremlin refuses to engage in good-faith negotiations to end the Ukraine war or breaches any agreements. The impact on oil prices would be more severe if secondary tariffs were deployed against a major producer like Russia. Iranian oil, which continues to flow to China despite Trump reupping his 鈥渕aximum pressure鈥� sanctions campaign, could also eventually be targeted if there is no progress on nuclear talks.

The measures, if implemented, could hit US allies as well as adversaries, including the EU, India and Gulf states. But analysts say the primary target is China, a major buyer of US-sanctioned oil that has traditionally opposed the US' extraterritorial 鈥渂ullying." And the effectiveness of the secondary tariff threat is marginal, analysts say, due to the impact of other tariffs which have virtually halted US-China trade. 鈥淎n additional 25% when US tariffs on Chinese goods were already 145% isn鈥檛 going to move the needle,鈥� said Rachel Ziemba, founder of consultancy Ziemba Insights.

Implementation Questions

Trump has sought to flex US economic muscle to achieve various foreign and domestic policy goals. But by adapting the idea of secondary sanctions to tariffs, he is adding to the acute uncertainties caused by his trade wars as he brings in issues unrelated to trade. For Venezuela, the policy objective ostensibly relates to migration and criminal gangs and comes in addition to the wind-down of Chevron's operations and revoking of sanctions waivers for India鈥檚 Reliance and Spain鈥檚 Repsol in the Opec producer.

It's unclear if secondary tariffs will go beyond threats 鈥� in Venezuela's case, there has so far been little action, with the executive order merely stating that the secretary of state can, not should, impose secondary tariffs, leaving a degree of discretion.

Experts raise numerous questions around how the novel concept will work in practice. Could they be turned on and off, and if so, based on what? Would they be scaled based on the level of imports? Would importing a single barrel of crude result in higher tariffs across the board? Would buyers of a targeted oil be hit if the oil is transshipped through a third country, as with Iranian crude that is relabeled "Malaysian" for export to China? Can some governments in market economies demand that private companies halt imports of a particular crude? 鈥淚t鈥檚 not clear how secondary tariffs would function,鈥� said Joseph Webster with the Atlantic Council鈥檚 Global Energy Center.

Then there is the question of legality. The Venezuela executive order authorizing secondary tariffs is based on questionable legal ground, with both Congress and the courts potentially acting as a break on Trump鈥檚 expansive use of untested emergency powers to launch trade wars and justify secondary tariffs.

Policy Trade Offs

Trump鈥檚 trade policy has gone through whipsaws and partial reversals, raising further questions about the role of secondary tariffs. Ziemba said they could conflict with the US goal of wanting to strike trade deals. For example, the Trump administration is prioritizing a trade deal with India that would open up the world鈥檚 most populous country to US goods and services. It seems unlikely that India鈥檚 imports of Venezuelan crude, which averaged just 60,000 barrels per day in 2024, according to Kpler, would be allowed to jeopardize such a deal 鈥� they may in any case cease when Reliance stops buying Venezuelan oil next month. But the trade-offs and disturbances would be much higher if the US were to implement secondary tariffs targeting Russia, whose crude exports to India averaged nearly 1.8 million b/d last year. In China's case, meanwhile, a marginal tariff increase would have little impact on Beijing鈥檚 decision-making but would add a layer of complication to trade talks that the US is eying.

Blowback and Evasion

Secondary tariffs also risk collateral damage. Unlike secondary sanctions that only target specific non-US entities, they target an entire country. Trump has already walked back some of his tariffs after they triggered market chaos, suggesting economic concerns may limit his desire to up the tariff ante. His administration has even hinted it could lower 鈥渦nsustainable鈥� tariffs on China to kick-start trade talks and avoid supply chain shocks, further militating against the idea of adding secondary tariffs to the mix. 鈥淪econdary tariffs may impose broad economic costs on the economies of both the targeted country as a whole and the United States by affecting the overall trade volumes of both countries and causing broad-based cost and price effects,鈥� K2 Integrity, a Washington advisory firm, said in a note.

For countries with limited US trade, the opportunity to buy discounted oil might outweigh the secondary tariff threat. And tariff evasion is also possible. If secondary tariffs on oil importers became widespread, some countries with limited exposure to US trade could become oil 鈥渉ubs鈥� for evasion, said the Council on Foreign Relation鈥檚 Brad Setser. 鈥淏etween the various different tariffs, at some point trade with the US for some countries will become so low, they're willing to sacrifice their trade with the US to buy the US-targeted oil from Venezuela, Iran or Russia," he said. 鈥淟ike any sanction, there are workarounds that will develop.鈥�