Cuba closing oil deficit: Cupet

Cuba has been "steadily" increasing oil imports since April, easing a fuel shortage and boosting production at the Cienfuegos refinery, an official of state-owned Cupet tells Argus.

But the island still needs another 18,000 b/d to meet demand of 160,000 b/d and to stabilize the energy sector, the official said.

In March 2018, Cupet said the deficit was "about 26,000 b/d", and earlier, in December 2017, pegged the deficit at 30,000 b/d.

The increased imports that are closing the deficit are coming from "several new and traditional" sources, and are managed by the foreign trade ministry, the official said.

The trade ministry has not responded to a request for details, but Argus has confirmed that Venezuelan state-owned PdV delivered around 50,000 b/d of light crude to Cuba in June, July and August.

According to internal PdV reports, the crude shipped to Cuba is light Mesa grade that PdV normally uses for blending with its abundant extra-heavy crude. It is not clear if Cuba is processing the Venezuelan light crude or reselling some of it directly or as a blend.

Cupet said it could not confirm the Venezuelan import figures, and that any trading, including re-exports, is handled by the foreign trade ministry.

Cienfuegos throughput has increased to an average 28,000 b/d because of the expanded crude supply, Cupet said. The Soviet-era facility processed an average 24,000 b/d in 2017 because of the shortfall in Venezuelan crude supplies, a Cuban government statement said in December.

Cuba still lacks sufficient gasoline and fuel oil for power generation, leading to frequent blackouts. The government is ensuring adequate supplies of some products such as LPG, which is the island's main fuel for cooking.

Cuba has been scrambling for oil since at least 2015, when PdV started cutting back on more than 100,000 b/d of supply to the island because of falling domestic production and oil-backed commitments to China and Russia.

The island's imports are supported by domestic production that averages 52,000 b/d.

The Cuban government said in January 2018 it planned to take delivery of unspecified volumes of crude and products from Algeria's state-owned Sonatrach in 2019-21.

The expected shipments follow previously agreed quantities of crude supplied by Sonatrach this year.

Cuba has also imported some crude and products from Iran, Angola and Trinidad and Tobago, to compensate for the reduced Venezuelan supplies, Cupet said in March.

In October 2017, the Cuban government said Cupet was in supply discussions with Russian state-controlled Rosneft, and the company's potential involvement in the upgrading and expansion of Cienfuegos.

The refinery had been operated by a Cupet joint venture with PdV known as Cuvenpetrol. But Cupet quietly took over PdV´s 49pc stake in August 2017.