With new energy tariffs, the math keeps changing for specialty oil buyers. The U.S. turned on new “reciprocal” tariffs, the White House hit many Brazilian goods with a 50% duty, and on top of all this, war-risk insurance for Persian Gulf routes jumped. Here’s what it all means for your landed costs and how to protect your margins. Questions? Contact us.
In early August, energy tariffs and shipping surcharges shifted fast, and U.S. buyers felt it.
Whether you pull white mineral oil from U.S. Gulf terminals, source from Canada, or rely on additives tied to China or Brazil, these changes can swing a purchase order by double digits.
In this article, we recap what just changed, why it matters for your landed costs, and the simple steps to keep your next specialty oil PO on budget.
Suzanne Kingsbury, Director of Quality
Energy Tariff Changes Since July
U.S. “reciprocal” energy tariffs took effect on August 7th.
The White House activated its reciprocal tariff program, raising duties on many partners to new bands. Legal and market trackers estimate the effective average U.S. tariff rate is now around the high-teens—its highest level in decades—while some country rates are still in negotiation. That means more invoices will carry extra line items tied to energy tariffs and related categories.
A new 50% U.S. tariff now covers many Brazilian goods–but energy was excluded.
Within days, Brazil–U.S. talks hit turbulence after Washington set a 50 percent rate on a wide set of Brazilian exports. Thankfully, energy products such as oils were excluded. However, companies importing other products from Brazil should be aware that Brazil’s government is pushing back and weighing counter-steps. For U.S. buyers of non-energy products, assume tighter supply and higher prices on Brazil-linked inputs until there’s clarity.
Canada remains a special case—for now.
Earlier in the year, Washington set a 25 percent tariff on most Canadian goods and 10 percent on Canadian energy products, inviting Canadian countermeasures. However, goods that are compliant with the USMCA (US-Mexico-Canada Agreement), including oils and other energy products, are exempt—for now.
If you import Canadian stocks, confirm whether your exact HTS code sits inside an energy carve-out or the broader tariff bucket. This detail can swing your landed cost by double digits. And of course, keep in mind that everything is in flux. In the midst of all this uncertainty, these rules could change at any moment.
Persian Gulf shipping risk is adding quiet costs.
War-risk insurance premiums for voyages through or near the Strait of Hormuz spiked in late June and stayed elevated into August. Quotes around 0.5 percent of hull value are common on some Middle East Gulf routes. That can add “tens of thousands of dollars” per voyage or roughly cents-per-gallon to delivered costs, depending on trip length and cargo.
“The position on (insurance) rates is subject to constant change.” — David Smith, Head of Marine, McGill and Partners (on Gulf war-risk premiums)
Why It Matters For Specialty Oil Buyers
Energy tariffs aren’t just headlines—they can seriously impact your invoice. A 10–50 percent duty, a small war-risk surcharge, or a mis-coded HTS line can swing landed costs on white mineral oils, GTL isoparaffins, and key additives.
“Price increases that will inevitably follow these unprecedented tariff levels … [make] supply chains impossible to predict.” — Neil Bradley, EVP & Chief Policy Officer, U.S. Chamber of Commerce
Here’s how these shifts are hitting specialty oil buyers right now.
- Tariff math moves margins. A 10% tariff on a $1.20/lb component adds about 12¢/lb. A 25%–35% rate change can wipe out margin on many specialties. If a 50% duty hits a Brazilian-origin input, it may push you to a new source or a different grade altogether. Energy tariffs now show up more often and at higher rates than buyers are used to seeing.
- Routing costs creep in. When war-risk premiums jump to ~0.5% of hull value in the Gulf, shipowners and carriers pass that through. The result is a quiet bump in delivered cost per barrel. This is sometimes enough to erase the savings of a cheaper FOB quote, i.e., Free On Board, the seller’s price for everything up to loading, which does not include risk of transport. Watch freight, insurance, and “surcharges” columns as closely as the product line.
- Compliance friction slows deliveries. With Canada’s split treatment (energy vs. non-energy) and Brazil’s new 50% rate, brokerage teams are scrutinizing HTS codes. A wrong code can mean a hold, a re-file, or a surprise duty bill. Expect more document checks through August and September.
Practical Moves For Late August And Early September
Energy tariffs are shifting fast, but you can still control your landed costs. Use the steps below to tighten codes and quotes, firm up freight plans, and lock in clean documentation so every PO you place this month protects margin.
- Re-audit HTS codes line by line. Confirm whether each SKU sits inside an energy carve-out, a reciprocal band, or a special country rate. Get your broker’s sign-off in writing so there are no last-minute holds.
- Ask for multiple quotes, if applicable. Request landed-cost scenarios that reflect: (1) the post-August-7th baseline under reciprocal tariffs; (2) alternatives if any Brazil-origin inputs now carry a 50% duty; (3) a contingency if agency guidance shifts a rate mid-order.
- Pad schedules and budget for Persian Gulf routes. If your cargo or a key intermediate touches the Middle East Gulf, expect premium volatility week to week. Build in time and a buffer for war-risk. Consider non-Gulf routings for high-value or time-critical cargos.
- Tighten contracts. Make sure your purchase terms cover tariff pass-through, routing changes, and force-majeure (unforeseeable) events tied to shipping risk. A short amendment can save long arguments later.
Despite New Energy Tariffs, Renkert Oil Helps You Control the Variables
When energy tariffs and shipping costs change week to week, you need a partner who does more than sell oil.
Renkert Oil helps you cut risk with U.S.-origin specialty oils, flexible routing from multiple terminals, and hands-on help with HTS, USMCA, and CBAM (the EU’s Carbon Border Adjustment Mechanism) paperwork.
Here’s how we keep your supply and costs steady.
- U.S.-origin specialty oils. We stock U.S.-origin white mineral oils and other specialty oils that help you avoid high-tariff lanes and cut customs friction.
- Redundant logistics, fast reroutes. With multiple Gulf and East Coast locations, our logistics team can pivot around port delays, carrier issues, or war-risk spikes—often without changing your delivery window.
- Blanket orders & safety stock. We can hold your inventory at multiple facilities, often within your region, and release on your schedule so tariff swings or shipping delays are less likely to slow you down.
The result? Steady supply and predictable costs, even when energy tariffs change by the week.
Ready To Protect Your Margins?
Energy tariffs are rising, spreads are shifting, and shipping risk is back in the price.
But you can stay ahead. Re-check your codes, price multiple scenarios, and work with partners who can move product and paperwork quickly.
If you want help modeling landed-cost scenarios for August and September, contact Renkert Oil now.
We’ll bring options—U.S.-origin supply, flexible routing, and clear documentation—so your costs stay predictable even when the rules don’t.