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Cars line up for gas at the seafront Malecon in Havana, Cuba, September 17, 2019. REUTERS/Alexandre Meneghini

Cuba forced to buy tanker to secure fuel

Cars line up for gas at the seafront Malecon in Havana, Cuba, September 17, 2019. REUTERS/Alexandre Meneghini

Cuba’s government is reporting that it was forced to buy an oil-products tanker that had refused to dock on the island for fear of US sanctions.

Cuba ‘s government said it was forced to buy a tanker that refused to dock because of fear of US sanctions.

According to Transport Minister, Eduardo Rodriguez, “We had to buy a ship that was near our coast that was carrying fuel we have already bought, because the ship-owner has refused to dock out of fear of US sanctions…We had no choice but to buy the vessel with money that we had to take from the limited financial resources available to the country to access that fuel.”

Rodriguez did not identify the vessel, its origin, capacity, contents or flag. The tanker purchase could not be confirmed by shipping sources outside of Cuba. However, reports out of Havana indicate that Cuba is still struggling to cope with lower subsidised oil supply from its close ally Venezuela.

Cars line up for gas at the seafront Malecon in Havana, Cuba, September 17, 2019.

Crude shipments to the island late last year by Venezuela do not seem to have eased Cuba’s oil shortage. A Caribbean diplomat in Havana reports, “We have seen the reports of increased shipments of Venezuelan oil to Cuba, but that is not being reflected here.”

The diplomat continued: “There are long lines at petrol stations, with holders of government-issued magnetic cards being favoured. There is a persistent shortage of LPG that the government had said would have ended this month, and blackouts are continuing.”

Cuba’s Transport Minister, Eduardo Rodriguez (Photo: miamiherald.com)

Cuba’s state-owned oil company Cupet declined to comment, referring queries to the foreign trade ministry, which could not be reached. The increased Venezuelan shipments to Cuba, and the persistence of shortages, indicate that the island’s government is running a high-inventory strategy, says Cuban energy expert, Jorge Pinon of the University of Texas in Austin.

“Long lines at stations are not due to the lack of fuel in Matanzas, Cienfuegos and Havana, but to a strategy of high inventories in case of a Venezuelan political collapse,” Pinon told Argus, which reports on news in the international petroleum market. Cuba is hoping to stabilise oil supply through a 10-year energy cooperation proposal offered by Russia. But the proposal hinges on the island’s ability to pay, Cuban officials tell Argus.

“We had no choice but to buy the vessel with money that we had to take from the limited financial resources available to the country to access that fuel.”

– Transport Minister, Eduardo Rodriguez

The island is not earning as much hard currency as it used to from tourism and the export of medical services, partly because of a tightening of the longstanding US economic embargo. The US has also targeted individual tankers that shuttle oil from Venezuela to Cuba.

Moscow’s oil-supply plan, first agreed by a Russian-Cuban commission in 2019, was restated during a visit three weeks ago by Russian Foreign Minister, Sergei Lavrov to Havana, a Cupet official said. Russia and Cuba will continue to “build a model of long-term mutually beneficial cooperation…to ensure energy and food security,” Lavrov said during the visit.