Versión Español
EspañolThe amount of oil Venezuela is able to deliver to Cuba has diminished significantly due to the country’s economic and political crisis.
As a result, Cuba has undergone its own energy crisis, forcing officials to look for new supply alternatives.
In July, Raul Castro confirmed rumors surrounding a “contraction” of oil imports from Venezuela, saying that the lack of oil was putting pressure on Cuba’s economy.
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The Cuban government told producers to “tighten their belts” in expectation of a 50-percent reduction in electric and fuel consumption.
The decline in imports from Venezuelan oil have been predicted to be as high as 40 percent — meaning 40,000 of the 100,000 barrels the country has received everyday for the last 10 years.
Cuban economic growth reportedly fell one percent this year, no doubt due to its faltering relationship with Venezuela.
Economists studied the period 2017-2018 and determined a rising oil bill will possibly unbalance all of Cuba’s payments. They also fear productivity and domestic tourism will take a hit as well.
Cuban economist at the Javeriana University of Colombia Pavel Vidal said the impact of the 2016 energy crisis in Cuba could be lengthy, possibly leading to a recession.
Cuba produces only 45 percent of its own oil needs, but it can only be used for derivatives and electricity generation.
MEO Australia, one of many foreign companies exploring oil in Cuba, announced in June that it had discovered an oil field north of Havana with more than eight million barrels. So far, the Cuban government has been silent on the discovery.
Many experts have said they believe one of the island’s other long-term partners — Algeria — will step up and help solve the energy crisis in Cuba.
Algerian company Sonatarach is reportedly considering dispatching 515,000 barrels to Cuba in October. The company has not confirmed this information.
Russia serves as another alternative, as Castro recently asked Vladimir Putin for help during the most recent visit of Iran Chief Diplomat Javad Zarif.
Cuba remains less dependent on Venezuela than it had on Russia, even during the Cold War. Cuban tourism soared after the agreement with the United States, which in turn evened out accounts with most of creditors.
Boston University Professor of International Relations Paul Webster Hare said he does not believe the economy will go into crisis mode yet again, “but expectations of Cubans and their faith in the government are also different from those 25 years ago.”
In addition, Hare said the efforts made by Raul Castro to modernize the economy have produced “insignificant” results.
“Cubans know that America is no longer the sworn enemy,” he said. “And unlike Fidel in 1994, the authorities can not ask for more sacrifices. ”
Source: El Nuevo Herald
