Washington Allows Resale of Venezuelan Oil to Cuba Under Conditions to Support Private Sector and Alleviate Energy Crisis
The U.S. Treasury Department announced that it will permit companies to apply for licenses to resell Venezuelan oil to Cuba, a move that could help ease the severe fuel crisis affecting the island.
This decision follows a halt in Venezuela’s supplies to Cuba since early January, after Washington tightened its control over Venezuelan oil exports following the arrest of President Nicolás Maduro, exacerbating the energy crisis impacting electricity generation, fuel supplies for vehicles, homes, and the aviation sector.
For over 25 years, Venezuela has been the main supplier of crude oil and fuel to its political ally Cuba, under bilateral agreements largely based on barter with products and services.
However, American pressures halted this arrangement, as shipping data indicated that Mexico—which emerged as an alternative supplier since 2023—stopped sending new shipments to Havana after January.
Major trading companies such as Vitol and Trafigura handle a significant portion of Venezuelan oil exports, shipping millions of barrels to the U.S., Europe, and India, while storing additional quantities in Caribbean facilities for resale.
New American Conditions
U.S. President Donald Trump emphasized that Venezuela’s allies receiving its oil through barter or debt repayment must pay “fair market prices,” pointing out China and Cuba among these allies.
According to Treasury guidelines, any transactions for the resale of oil must “support the Cuban people, including the private sector,” through commercially or humanitarian-driven exports. Transactions benefiting the Cuban military or other government institutions will not be permitted.
It remains unclear whether Cuba can purchase oil under the new conditions without preferential treatment, especially since the Cuban government controls fuel and energy distribution through state-owned companies, despite private consumers like private airlines.
Regional Moves and Humanitarian Concerns
The American decision coincides with the arrival of Secretary of State Marco Rubio in the Caribbean to discuss with leaders who warned that worsening the humanitarian crisis in Cuba could destabilize the region.
Previously, Russia announced its readiness to send a shipment of oil and petroleum products to Cuba as part of “humanitarian assistance,” amid widespread power outages, long fuel lines, and disruptions in transport and tourism sectors.
Havana faces one of its worst energy crises in decades, with UN warnings that the ongoing fuel shortage could lead to deteriorating essential services, including healthcare and education, if supplies do not resume sufficiently in the near future.
