President Donald Trump and Republicans promised to cut gas prices in half on the campaign trail. Now, Trump’s tariffs on Canadian energy threaten to balloon energy costs where Republicans are vulnerable in the 2026 midterms.
The Midwest and New England are deeply dependent on Canadian oil and gas to fuel cars, trucks and homes — making them susceptible to inflation caused by Trump’s 10 percent duty on Canadian energy. Both regions also have critical tossup congressional races next year that will determine the balance of power for the second half of Trump’s term.
“I think you’re gonna hear a whole lot about prices across the board in 2026,” said Sen. Martin Heinrich of New Mexico, the top Democrat on the Senate Energy and Natural Resources Committee.
“That is going to be the conversation in 2026. And it’s going to extend to the energy market, not just gas. But also, I guarantee you we have all the makings of people’s electric rates going up fairly substantially between now and that election.”
Trump in early February announced a blanket 25 percent tariff on all goods from Canada and Mexico along with a 10 percent tariff on Canadian energy, claiming the countries were allowing fentanyl to cross the border. He quickly delayed them for a month but allowed them to take effect this week, sending markets plummeting and prompting swift retaliation from Canada.
Then on Thursday, Trump changed course again, declaring any goods covered by the U.S.-Mexico-Canada Agreement (USMCA) free trade pact would be exempt from the tariffs until April.
Notably, energy accounts for a large share of the roughly 62 percent of goods imported from Canada that is not exempted by USMCA, so it could still face the 10 percent tariff, according to a White House official granted anonymity to brief reporters on the changes.
Additionally, the threat of the full 10 percent tariff on all Canadian energy still hangs in the balance for early April.
The Midwest and New England hold some of the keys to Democrats retaking congressional majorities.
Sen. Susan Collins (R-Maine), the only Republican federally elected in New England, is up for reelection. Democrats are seeking to hold the seat of Sen. Jeanne Shaheen (D-N.H.) and will battle for two open swing seats in Michigan and Minnesota.
There are also troves of competitive House races that could feel the brunt of the tariffs. Iowa Reps. Mariannette Miller-Meeks and Zach Nunn are targets for Democrats in Iowa. Miller-Meeks won her last election by just under 800 votes, and Nunn’s seat was held by Democrat Cindy Axne until 2022.
Democrats are seeking to hold the seats of Reps. Jared Golden (D-Maine) and Maggie Goodlander (D-N.H.).
Golden, one of the most conservative Democrats in the House who represents a district Trump has won in each of his elections, supports Trump’s tariff moves, saying they’d help onshore American manufacturing.
Some senators who are up for reelection in 2026 have already begun blaming Trump and the GOP for expected increases to energy costs.
“Oh absolutely, we’ve already started,” Shaheen said when asked if Democrats are preparing to heap blame for high energy costs on Trump and Republicans.
Gas prices have largely remained steady so far, according to AAA, hovering around the $3 mark nationally and in New England. However, after the tariffs were enacted, some states like Michigan and Maine did see slight jumps. Large price shocks would likely take time.
Shaheen is up for reelection in 2026 and has filed paperwork to run for a fourth term in New Hampshire next year in what’s expected to be a competitive race, though she has not publicly decided whether she will run. Holding her seat is critical to Democratic ambitions of retaking the Senate.
Collins, chair of the Appropriations Committee, appeared to recognize the peril that lies ahead if Trump’s tariffs take a toll on her state, telling reporters she’s “concerned” about their economic impacts.
She specifically cited energy costs in joining with other Maine lawmakers in a recent bipartisan letter urging Commerce Secretary Howard Lutnick to change course.
“Given the deeply integrated nature of our economies, any tariffs on imports from Canada — and any retaliatory measures by Canada in response — may raise prices on gasoline, energy, groceries, and much more,” the group wrote.
New England is likely to see the first cost hikes from the tariffs because it relies heavily on oil and gas exports from an Irving refinery in New Brunswick. The region is also reliant on home heating oil from Canada, an anomaly in the U.S. that could push inflation even higher there.
“Irving has already sent out notices saying we’re going to raise your prices,” Shaheen said. “We’re hearing from people all over.”
Indeed, analysts have noticed the spike in New England. TACenergy, a fuel distributor, said “rack prices across New England saw double digit increases overnight as there’s simply no simple replacement for the products shipped from Irving Oil’s refinery that’s the primary supply point for multiple terminals in the area.”
Midwestern races
The tariffs also threaten Republicans in what has become one of their strongholds in the past few decades: the agrarian and industrial Midwest.
The Midwest imports more crude oil from Canada than any other region in the United States — so much that its refineries were purpose-built to process heavier Canadian oil and can’t function without it.
That type of crude is rarely found in the U.S., likely forcing those refineries to either pay more for the oil they need from Canada or cut production — both of which would be inflationary.
“Motorists in the Great Lakes, the Rockies and Midwest would probably be more susceptible,” said Patrick De Haan, the head of petroleum analysis at GasBuddy. “The Great Lakes is the most susceptible region … every refinery in the Great Lakes generally refines Canadian crude oil.”
The Midwest and Great Lakes regions will be home to some of the fiercest congressional battles next year. Sens. Gary Peters (D-Mich.) and Tina Smith (D-Minn.) are both retiring, opening up Democratic seats that Republicans are desperate to flip.
Smith, in an interview, said the region will not just be hurt by oil and gas but also by other sources of energy like hydropower. The tariffs cover all forms of Canadian energy, including hydropower.
“It’s a big deal because that hydropower is a very important part of the baseload for powering the taconite plants and all of the residences in northern Minnesota,” Smith said. Taconite is a low-grade iron ore.
“It’s going to have an impact on not only residential energy costs but also on the taconite plants that are the source for like 80 percent of the raw material steel in this country.”
‘They’re just going to roll over’
Miller-Meeks, Nunn and other Midwestern House members that represent troves of politically powerful farmers may be hit with a double whammy.
During the last Trump administration, farmers around the country were devastated by Trump’s tariffs on China and received a record bailout for it. Farmers are already bracing for the impact of Trump’s new tariffs, and now could also have to compete with higher energy costs for their machinery.
“Under Biden that’s why we wound up with such devastating financial times, the cost of diesel [and] the availability of fertilizer,” said Glenn Thompson (R-Pa.), the chair of the House Agriculture Committee.
Still, Thompson gave the White House plenty of leeway to pursue tariffs.
“Navigating using tariffs as a tool is not easy,” Thompson said. “I think President Trump is probably more effective with that than anyone in the past has been, [and] if we do wind up with retaliatory tariffs, we’ll make sure the [USDA] is there just like we did in Trump 45.”
Republicans have for years blamed inflation under Biden as a reason for a recent drop in agricultural revenue and high grocery prices.
Rep. Jared Huffman (D-Calif.), who is the top Democrat on the House Natural Resources Committee that has jurisdiction over oil and gas development on public land, acknowledged the opening for the party.
“I think there will be political opportunity,” Huffman said. “The other thing that is almost a given is whatever harmful effects are felt by these Republicans and their constituents, they won’t have the guts to do anything about it, they’re going to just roll over.”
Indeed, Republicans are grappling with the tariff fallout in different ways.
Sen. Mike Rounds (R-S.D.), argued for Trump to be granted some leeway on his tariff moves since he believes they will end up with lower costs for American consumers.
“We know that the president’s overall goal is to reduce energy prices, he thinks this is an appropriate strategy to do so, so most of us are simply saying we’re going to give the president the opportunity to work on this project,” Rounds said.
“But you know, the American public are going to want to see energy prices go down,” he added, a potential nod that Trump may lose his runway for tariffs if voters get too fed up with rising prices.
And Nunn argued that Trump’s tariffs, while potentially painful for farmers and others, are a tactic.
“This is all part of a negotiation, right?” Nunn said. “All the more reason for the U.S. to look at an energy independence solution that works domestically.”
Reporter Mia McCarthy contributed.
