Jorge Pinon, the principal researcher at the Energy Institute of the University of Texas, has provided the following additional details about Cuba’s current fuel crisis.[1]
“Cuba does not have money to buy [fuel] in international markets and the suppliers with which it had commitments [Venezuela, Mexico and Rosneft of Russia] are not fulfilling them.”
In June 2022 Russia announced an agreement for Rosneft annually to supply Cuba with 1.64 million tons of oil and derived products, and this May Rosneft delivered an estimated 800,000 barrels, but that flow has stopped. Rosneft apparently is waiting for a Cuba-Russia intergovernmental agreement to guarantee payment for the market value of these shipments because Rosneft does not want the Cuban debt with a Russian guaranty to appear in its financial reports.
The Mexican supplier (Pemex) over the last decade has decreased its crude oil production every year over the last decade and has the highest debt ($110.5 billion) of any major oil company. And the Mexican government if facing its largest fiscal deficit in more than three decades and is studying the possibility of selling Pemex.
Venezuela’s state-owned oil company (PDVSA) has had problems producing enough oil for its own domestic needs, thus reducing what it can export. For this year (through August) it has exported 449 million barrels in fluctuating amounts to Cuba.
Cuba itself produces about 40,000 barrels of oil per day, but needs another 100,000 per day to meet demand, which Venezuela cannot itself provide. In addition, Cuba’s national electrical system suffers from lack of maintenance.
“The new Cuban energy crisis is so delicate that any adverse event on the island (the breakdown of a thermoelectric plant; a hurricane; a fire in a petrochemical facility) or abroad (increase in oil prices, a new trade war or armed confrontation) could complicate it to extremes.”
“Any way you look at it, any solution will take time and money. Havana has neither one nor the other. And it is clear that the [Cuban] Communist Party prefers to ask its governed to sacrifice themselves rather than begin to solve forever a problem that further compromises the future of the island and that of the group in power.”
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[1] Reyes, The truth that the Government of Cuba will not tell about the new fuel crisis, Diario de Cuba (Sept. 29, 2023),