Prime Minister Paul Martin has taken Canada's fight with the U.S. over softwood to the U.S. -- and his implied threats to turn off the oil taps to the U.S. market is attracting some attention south of the border.

In a speech to the Economic Club in New York on Thursday, Martin called the U.S. position "nonsense" and a "breach of faith".  In that speech, and later on CNN, Martin hinted that Canada could use its oil as a weapon to force U.S. President George Bush's hand over duties imposed on Canadian lumber.

"(T)here's no doubt that the  entry of China and, and India on the world scene provides Canada with markets that have hitherto never been possible, huge consumer  markets," said the prime minister on CNN.

The "duties" refer to the $5 billion that the U.S. has collected on Canadian softwood imports since May 2002.

Canada wants the money back -- and has been backed up by growing number of NAFTA dispute-resolving processes. The latest came Wednesday, when a NAFTA panel released a fifth report instructing the U.S. Commerce Department to stop charging duties on Canadian softwood.

But the White House has disregarded all of those rulings, arguing that decisions in their favour from the World Trade Organization take precedence.

So far, the White House is downplaying the Prime Minister's implied threats to turn off the oil taps.  When asked for reaction, White House Press secretary Scott McClellan said the U.S. is committed to resolving the lingering lumber issue.

"Prime Minister Martin is a good friend," said McClellan.

"The President has worked very closely with him to address our shared priorities. We have a good relationship with Canada. This is one of those issues that has been a difficult issue, that we've been trying to work to resolve. And our trade officials are trying to resolve these issues as we speak."

An editorial in the influential Wall Street Journal Friday sided with the Canadian position, adding ammunition to Martin's campaign.

"Americans have a stake here too, since the duties add about $1,000 to the cost of a new home and affect thousands of jobs in industries that depend on lower-cost Canadian lumber," the editorial read.

With a fall election still possible, some are saying Martin's tough talk in the U.S. may have been aimed more at the domestic audience here in Canada. For all the sound and fury, they say, it's unlikely the Prime Minister would risk a trade war with Washington or a backlash from oil producing Alberta.

Liberal cabinet ministers are denying that Martin was directly linking energy to softwood.

"There is no linkage between our concerns over softwood lumber and the energy sector...," said Deputy Prime Minister Anne McLellan.

"The message is NAFTA (the North American Free Trade Agreement) is there.  NAFTA has helped both our countries enormously.  We live up to the terms of NAFTA.  We ask you, our best friend and most important trading partner to do the same thing."