Cessation of oil shipments from Venezuela would force Cuba to spend 2 billion dollars

The regional political context, the crisis in Venezuela and, with it, the decrease in the supply of fuel could become a serious problem for Cuba in the coming months. That was confirmed to El Nuevo Herald by Jorge Piñón, director of the energy program for Latin America at the University of Texas at Austin.

Piñón assured the Miami newspaper that if Maduro falls, or failing that, if Juan Guaidó manages to stop oil shipments to the Caribbean island, the Havana regime could see a critical situation that would force it to pay nearly 2 billion dollars a year to satisfy domestic demand for fuel.

“Cuba’s demand for oil is approximately 130,000 barrels a day and Cuba produces around 50,000 barrels a day, which means a deficit of around 80,000 barrels a day,” said the director.

Although for the time being there are no reports of massive cuts in electricity or announced blackouts, losing Venezuelan oil would represent a hard blow to the island’s economy, already affected by the recession and the toughening of sanctions of the Donald Trump administration.

Piñon explained to the Herald that the island has reserves of fuel for about 45 days and that, if shipments stop, the government would be forced to spend about $5.2 million to buy at international market prices – $65 a barrel – the 80,000 barrels of oil it needs to meet daily domestic demand.

For this reason, not a few analysts affirm that Havana is looking for alternatives to replace the decline in Venezuelan crude oil, which could come from Russia and Algeria, strategic allies of the island. All this in a framework where the Cuban regime has already lost the profits from the medical mission in Brazil, an important part of the 11 billion dollars that the country received annually for the export of professional services.

Just two weeks ago, the opposition-controlled National Assembly of Venezuela ordered the suspension of shipments of crude oil to Cuba, established in an agreement to exchange oil for medical services between the late governors Fidel Castro and Hugo Chávez, as a result of which the state-owned PDVSA sent between 40,000 and 50,000 barrels of oil a day to Cuba.

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