President-elect Donald Trump's threatened tariffs could prompt Canada to pursue dollar-to-dollar retaliation or an export tax on oil and gas bound for the U.S.

The government is preparing for the possibility that the incoming U.S. administration will impose high tariffs on Canadian goods, setting the close allies up for a showdown.

Canadian Prime Minister Justin Trudeau has suggested that President-elect Donald Trump’s remarks about Canada becoming America’s “51st state” is distracting the public from the harm that steep tariffs would have on U.

Canada could impose countermeasures on up to C$150 billion worth of U.S. imports if President-elect Donald Trump puts tariffs on Canadian goods and services, a source familiar with the matter said on Wednesday.

Canada has drawn up an initial list of C$150 billion ($105 billion) of US-manufactured items that it would hit with tariffs if President-elect Donald Trump decides to levy tariffs against Canadian goods,

Canada’s effort to push back against possible US tariffs is being undermined by Alberta Premier Danielle Smith’s pledge to fight federal plans to cut or tax crude exports to the US, Canada’s natural resources minister said.

Canada is preparing a list of potential US retaliatory tariffs and some of those could be on critical minerals, Energy and Natural Resources Minister Jonathan Wilkinson said on Thursday. Wilkinson said that Canada was looking at points of leverage that will create maximum pressure on the United States to come to table to find a resolution to the tariff issue.