Trump Delays 50% Canada Tariffs Three Days, Dangles Keystone XL Revival

President Trump announced late Tuesday he was pausing new 50% tariffs on Canadian goods for three days, hours before they were set to hit at 12:01 a.m. Wednesday, August 19.

"I have paused the 50% Tariffs against Canada... based on the fact that Canada and the U.S.A., subject to the finalization of documents, have a DEAL!" Trump wrote on Truth Social, according to the Washington Post and BNN Bloomberg.

The tariffs would have hit a broad range of Canadian products, including wine, dairy, cement, furniture, beer, cheese and hockey gear, according to Forbes. Estimates on the dollar value vary by source: Forbes and Newsweek put the affected goods at roughly $20 billion, while BNN Bloomberg reported the figure at closer to $28 billion. That gap isn't explained in either outlet's reporting, so take both as ballpark estimates rather than a confirmed number.

Trump used Section 338 of the Tariff Act of 1930, a Depression-era law allowing tariffs up to 50% on countries the president deems discriminatory, to impose the levies last month. The White House accused Canada of discriminating against U.S.-made cars, alcohol and dairy products, per Forbes.

Carney Says "Substantial Progress," Not a Done Deal

Canadian Prime Minister Mark Carney was notably more cautious than Trump. "Substantial progress has been made, although there is important work still to be done," Carney said in a statement, confirming the tariff pause runs through the end of day Friday, August 21.

Carney said Canada has spent recent weeks in "intensive discussions" with the U.S. to nail down trade issues, while also "building a stronger, more independent, and more competitive economy at home." Carney's statement did not mention Keystone XL at all, a detail both BNN Bloomberg and the Guardian flagged directly.

U.S. Trade Representative Jamieson Greer said on X that the deal will include "comprehensive market access for all American goods, economic security commitments, digital trade alignment," and other worker protections, according to Forbes and Newsweek. No finalized text has been released.

The Keystone XL Tease

In the same post announcing the tariff pause, Trump said the Keystone XL pipeline "may be awoken from the grave." He followed up with an AI-generated image on Truth Social showing himself yanking a pipe out of the ground next to a tombstone reading "Buried by Biden," stamped with the words "Completely free. Energy. Jobs. America First."

Keystone XL was proposed in 2008 by TransCanada, now TC Energy, to carry up to 830,000 barrels of oil a day from Alberta's tar sands to Nebraska, connecting to existing lines running to Gulf Coast refineries, according to the Government of Alberta and Newsweek. Obama rejected it in November 2015. Trump revived it in 2017. Biden killed it again on his first day in office in 2021 by revoking the cross-border permit, and TC Energy formally scrapped the project that same year.

The pipeline has been a genuine flashpoint for over a decade. Environmental groups have raised legitimate concerns about spill risk, particularly through Nebraska's Sandhills region and over the Ogallala Aquifer, one of the largest freshwater reserves in the country. Native American tribes have argued the route threatens indigenous land and water rights. Those aren't fringe objections; they're the same concerns that drove years of federal review before Obama's 2015 rejection.

On the other side, supporters have long argued the project means real construction jobs and reduces reliance on oil shipped by rail or tanker, both of which carry their own spill and safety records. Trump's framing leans hard into that case, but he gave no operational detail: no permit application, no construction timeline, no confirmation it's actually written into the Canada trade deal.

Carney reportedly raised Keystone XL with Trump directly in an October conversation about tariffs and steel, sources told the BBC. That's the closest link between the pipeline and the broader trade negotiation that any source establishes. Whether it's now a formal bargaining chip in this week's deal, or just Trump talking, is unconfirmed.

What's Left Unresolved

Dan Kelly, president of the Canadian Federation of Independent Business, said on social media that killing the tariff threat and approving Keystone XL together would be "two big moves in the right direction" for small firms, but said he still needs to see whether progress was made on separate sectoral tariffs covering steel, aluminum, lumber and autos.

Candace Laing of the Canadian Chamber of Commerce was blunter about the uncertainty: "This limbo state is not anyone's preferred outcome. Time is of the essence."

Chris Swonger of the Distilled Spirits Council said American liquor exports to Canada have dropped more than 70% since several provinces pulled U.S. booze off shelves last year in retaliation for earlier tariffs. Eight provinces still have those bans in place.

The three-day pause runs out at the end of day Friday, August 21. No signed text of a U.S.-Canada deal has been released, no Keystone XL permit application has been filed or approved, and Carney has not confirmed the pipeline is part of any agreement at all.