Due to the fall in imports from Venezuela, Cuba faces fuel shortages

Cuba is struggling to fill a fuel deficit because imports from Venezuela and other countries remain below historical levels and world prices driven by Russia's invasion of Ukraine make purchases almost inaccessible, analysts and data say.

Since last month, the Caribbean country, which relies on fuel imports mainly from its ally Venezuela to cover more than half of its demand, has been facing shortages of diesel and gasoline since last month, generating long lines in front of gas stations.

Insufficient fuel imports are another major obstacle to Cuba's economy, which is struggling to recover from the coronavirus pandemic and the tougher US sanctions imposed by the government of former President Donald Trump.

Venezuela's President Nicolás Maduro has provided Cuba with more than 32,000 barrels per day (bpd) of crude oil since 2019 even amid US sanctions on both countries. But the volumes of fuel shipped have fallen because Caracas has struggled to produce refined products for its own needs, according to data.

Cuba imported some 70,000 bpd of crude oil and fuel in the first quarter of the year, down from the 100,000 bpd that the island generally requires to meet normal demand, monitoring data from oil tankers from Refinitiv Eikon showed.

More than three-quarters came from Venezuela, but the OPEC member nation has drastically cut fuel shipments to Cuba from nearly 44,000 bpd in 2020 to 21,000 bpd in 2021 and 22,000 bpd in the first quarter of this year, according to internal data and documents from state-owned PDVSA.

Before the pandemic, Cuba's demand for fuels reached 137,000 bpd for fuel oil, diesel, gasoline, cooking gas and other refined products, the Cuban National Bureau of Statistics reported.

Although the nation is consuming some 110,000 bpd of fuel this year, it still needs imports to compensate for insufficient domestic production, said Jorge Piñón, director of the Latin American and Caribbean Energy and Environment Program at the University of Texas in Austin.

“Cuban refineries are not 100% operational. The Havana refinery, the only facility with a catalytic cracker, is operating at around 70% of its capacity, while the Cienfuegos refinery is sporadically running 10,000 bpd and Santiago is not in service,” he said.

The island's energy and mines minister, Livan Arronte, said that Cuba, which remains under a US embargo that limits free trade with the country, is paying freight rates and other costs 20% higher than importers who bring fuel along the same routes.

(With information from Reuters)

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