Cuba forced to buy tanker secure fuel

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

"We had to buy a ship that was near our coast that was carrying fuel we have already bought, because the shipowner has refused to dock out of fear of US sanctions," transport minister Eduardo Rodriguez said on 25 February.

"We had no choice but the 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, which could not be confirmed by shipping sources outside of Cuba, suggests that Havana is still struggling to cope with lower subsidized oil supply from its close ally Venezuela.

Venezuelan state-owned PdV's extraordinary crude shipments to the island late last year — an apparent effort to unclog its Venezuelan terminals — do not seem to have eased Cuba's oil shortage.

"We have seen the reports of increased shipments of Venezuelan oil to Cuba, but that is not being reflected here," a Caribbean diplomat in Havana said.

"There are long lines at petrol stations, with holders of government-issued magnetic cards being favored. There is a persistent shortage of LPG that the government had said would have ended this month, and blackouts are continuing."

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 at 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.

Cuba is hoping to stabilize 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.

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 5 February visit 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.