(CNN) — President Donald Trump on Tuesday threatened a sharp escalation in the budding trade war with Canada in retaliation for Ontario’s export surcharge on US electricity.

Stocks immediately tumbled after Trump’s Truth Social post announcing his latest tariff threat before paring some losses. The Nasdaq Composite ticked into the green, up 0.3%, while the S&P 500 and Dow remained in negative territory, down 0.3% and 0.8%, respectively.

Trump said he would respond in kind to Ontario’s 25% surcharge on electricity to New York, Minnesota and Michigan with a 25% tariff on Canadian electricity. That could increase costs even more for Americans, particularly in northern states that rely on energy from Canada. Ontario’s surcharge, announced Monday, threatens to increase bills by $100 a month, Ontario Premier Doug Ford said.

In addition, Trump said he would levy even larger tariffs on Canadian steel and aluminum than he had planned Wednesday.

“Based on Ontario, Canada, placing a 25% Tariff on ‘Electricity’ coming into the United States, I have instructed my Secretary of Commerce to ad an ADDITIONAL 25% Tariff, to 50%, on all STEEL and ALUMINUM COMING INTO THE UNITED STATES FROM CANADA, ONE OF THE HIGHEST TARIFFING NATIONS ANYWHERE IN THE WORLD,” Trump said in a social media post Tuesday.

Ford threatened to shut off electricity supply to the US entirely.

“I want to send more electricity down to the US to our closest allies,” Ford said in an interview on CNBC on Tuesday. “Is it a tool in our tool kit?” he said of a shutoff. “100%. And as he continues to hurt Canadian families, Ontario families, I won’t hesitate to do that.”

Ford said he is set to speak with Commerce Secretary Howard Lutnick on Tuesday.

Trump also said he would declare a national electricity emergency in the states Ontario targeted. “Can you imagine Canada stooping so low as to use ELECTRICITY, that so affects the life of innocent people, as a bargaining chip and threat?” Trump said in a Truth Social post on Tuesday.

Meanwhile, he threatened to “substantially” increase tariffs on cars coming into the United States from Canada starting on April 2.

The president said those autos tariffs “will, essentially, permanently shut down the automobile manufacturing business in Canada. Those cars can easily be made in the USA!”

The announcement comes ahead of a midnight deadline for when Trump threatened to impose 25% tariffs across all steel and aluminum imports.

Another looming threat: A 250% tariff on dairy products from Canada, which the president announced on Friday, though he has yet to finalize anything. Trump said the tariff would be in response to Canada’s taxes on American dairy products, which can be as high as 241% in the case of milk.

In an interview with CNN’s Wolf Blitzer on Tuesday, Ford said such tariffs get “under (Trump’s) skin,” but said it’s all the more reason why he thinks Trump should want to “sit down and talk about it.”

A threat to the American economy, too

While Trump’s aim is to hurt the Canadian economy by imposing higher steel and aluminum tariffs on them, the move risks hurting the American economy as well.

Canada is the top source of iron, steel and aluminum sent to the US. The US imported $11.4 billion worth of aluminum and $7.6 billion worth of iron and steel from Canada last year, according to data from the US Commerce Department. (The government data groups iron and steel together.)

Canadian aluminum exports account for 41% of all aluminum the US imported last year, while Canadian iron and steel accounted for nearly a quarter of it.

The threat of a 25% tariff on Canadian aluminum alone could cost the US 100,000 jobs, the CEO of one of the largest US aluminum makers, Alcoa, recently warned.

In total, the aluminum industry directly employs 164,000 workers in the US and indirectly employs an additional 272,000 workers within industries such as mining, construction and manufacturing, according to the Aluminum Association.

Though Alcoa is headquartered in Pittsburgh, a significant share of Alcoa’s aluminum production is located in Canada and then shipped to the US, William Oplinger, CEO of Alcoa, said at an industry conference last month.

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