Gas prices hit record highs as Trump threatens Canada trade war

Diesel prices hit $5.85 per gallon over Labor Day weekend—the highest in years—while Trump escalated threats to terminate all trade with Canada unless the Federal Reserve cuts interest rates. A new poll showed that a majority of Canadians now view the U.S. as an enemy, a historic reversal in cross-border sentiment. The energy spike is real and immediate; the trade war threat is explicit and unambiguous.

Trump is using energy markets and tariff threats as levers to pressure the Fed on monetary policy—something presidents typically avoid doing publicly because it signals desperation to markets. The fact that he's willing to crater bilateral trade relationships over Fed rate cuts suggests he views economic stimulus as essential before the midterms. For Canada, the threat is specific: either comply or face economic retaliation. For U.S. consumers, the immediate pain is at the pump. The longer-term question is whether Trump follows through or whether this is negotiating theater. Given that he's already tangled with both the Fed and Canada simultaneously, treating it as bluff becomes harder to justify.