Energy Crisis in Cuba: The Political Game Behind the Regime’s Oil Strategy
Cuba is facing a deep energy crisis, exacerbated by insufficient crude production, outdated infrastructure, and an economic management approach that prioritizes exports over domestic needs.
Cuba’s Energy Crisis: A Collapsing System Amidst Desperation for Oil
The state-run Unión Cuba-Petróleo (CUPET) admits that domestic production covers only a third of the country’s consumption, forcing the regime to desperately seek foreign investment and higher-quality crude oil.
A System in Collapse
In 2024, national oil production fell short by 138,028 tons compared to projections, reaching only 98.5% of its targets.
According to CUPET’s head, Osvaldo López Corso, low production is due to a lack of resources and funding. Furthermore, most Cuban oil is extra-heavy and high in sulfur, suitable only for electricity generation, cement production, lubricants, and asphalt.
The oil infrastructure is on the brink of collapse: corroded pipelines, ineffective treatment plants, and damaged production lines. Combined with the proximity of facilities to the sea, maintenance costs are rising, and operational efficiency is plummeting.
The Role of Foreign Investment.
In this context, the Cuban government seeks to «win over» foreign companies to finance the exploration and production of oil. CUPET has identified potential deposits in areas such as Boca de Jaruco, East Havana, and Alamar, and plans exploratory campaigns in 2025.
These campaigns include drilling new wells and acquiring seismic data in areas like Varadero.
Companies like the Australian Melbana are already operating in Cuba, particularly in Block 9, where significant reserves of light crude oil have been found, which is more attractive for export.
However, this approach raises a crucial question: will the Cubans benefit from these discoveries, or will the high-quality crude be exclusively destined for the international market? Knowing the communist regime that rules this country … we can guess the answer.
Dependence on Russia and oil exports.
Cuba’s dependence on Russia for importing oil worsens the situation. The credits granted by Moscow increase the regime’s debt while Cubans face prolonged power outages and a chronic fuel shortage.
Paradoxically, the light crude discovered by Melbana Energy (an Australian company), which could alleviate the crisis, has been exported rather than used locally.
Fondas Kréyol reported the discovery:
«The oil found is of quite good quality,» the company explained in a statement. «It is significantly lighter» and of lower viscosity compared to the oil extracted in the Matanzas area, which, together with the northwestern coast, holds most of Cuba’s heavy crude oil deposits, high in sulfur, mostly used as fuel for electricity generation, reported Diario de Cuba.
«That it contains higher-quality oil has implications for the value of the produced oil and the possibility of higher recovery rates than originally estimated in our resource estimates,» said Purcell.
«It is important to highlight that these results were obtained by drilling less than 20% of the total area, and the flow rate exceeded our expectations for a vertical test at such a shallow level,» he added.
In recent years, several foreign companies have worked on the exploitation of various oil wells in Cuba. Some experts have stated that the oil extracted at different times is not of the best quality, although foreign companies have not lost interest in exploring the country’s fossil fuel deposits.
Currently, Cuba uses approximately 44% of its oil and 8% of its associated gas for electricity generation to power the economy and residential consumption.
The Cuban regime defends the export of this crude as a way to «generate foreign currency,» but this approach instead leaves citizens suffering from the consequences of an unprecedented energy crisis..
Although all of this sounds very strange, as the Cuban regime is not lacking money, many allies help them economically sustain their dictatorship.
Of the 554,000 bpd the country sold to its partners in August—333,000 less than in July, when it exported 877,000 bpd—the majority went to China, although the exact amount is not known, reported the British agency Reuters.
So the question is… Is the oil being offered by the regime truly Cuban?
According to data cited by Radio Martí and the portal 14ymedio, from January to October, oil supplies from Mexico to Cuba increased by 43.5 per cent.
Mexican crude oil currently accounts for about 25 per cent of the total consumption of this resource in Cuba. At the beginning of the fourth quarter of 2024, the average level of supplies was already over 31,300 barrels per day. The new President of Mexico, Claudia Sheinbaum, has pledged to continue supporting Cuba.
The curious thing is that, according to Texas University expert Jorge Piñón, the same area where this oil was found had been under the control of Cuba Petróleo (Cupet) «for more than 30 years without ever having made any significant discovery.»
Melbana Energy arrived on the island in 2015, and since then, it has obtained exploration permits for nearly twenty wells.
Meanwhile, extra-heavy oil remains the main source for electricity generation, increasing maintenance and operation costs for thermoelectric plants. If oil is being given to the regime… why does the Cuban people still face an energy crisis?
The strategy of the Cuban regime seems to be more focused on political survival than on the well-being of its population. The search for quality oil, while necessary, is tainted by corruption, lack of transparency, and an evident priority to export rather than meet domestic needs.
This crisis is not just a reflection of a poorly managed economy but also a warning about the consequences of maintaining outdated statist policies.
If the regime does not prioritize structural solutions that put the needs of the Cuban people ahead of external interests, the future of the island will become increasingly uncertain.
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