Last Friday, there were reports that Mexico was reconsidering its plans to continue shipping oil to Cuba.
The Mexican government is reviewing whether to keep sending oil to Cuba amid growing fears within President Claudia Sheinbaum's administration that Mexico could face reprisals from the United States over the policy, which is a vital lifeline for the Communist-run Caribbean island, according to three sources familiar with the discussions.
As I described here, that was a big deal because Mexico, according to some reports, was already Cuba's #1 source of oil by the end of last year. Venezuela was supply about 40% of Cuba's oil and Mexico was slightly above that with the rest coming from Russia and other places. Losing Venezuela's oil was bad but losing Mexico's oil would reduce the supply to almost nothing. As of last night Bloomberg was reporting that a planned shipment this month had disappeared off the schedule.
Pemex, the Mexican state oil company, has canceled an oil shipment to Cuba scheduled for this month, according to the US outlet Bloomberg. According to the report, released on Monday, the company had planned a shipment for mid-January on the Swift Galaxy, a Panama-flagged vessel, which was due to arrive to Cuba at the end of this month, but it disappeared from the schedule.
Bloomberg reports that it contacted the company and Mexico’s Secretariat of Energy, which did not immediately respond to its inquiry. Likewise, several Mexican media outlets, such as La Jornada and Sipse, have tried to contact Pemex with different results. The former was told “we have no information on the matter,” while the latter says it turned to experts after receiving no comment from the company. “Sources related to the energy sector indicate that the adjustment could be linked to factors such as crude availability, logistical planning, and international market conditions,” they note...
Pemex is currently Cuba’s largest oil supplier in the absence of Venezuelan crude, as contributions from Russia, Iran, or Algeria have — at least until now — been very limited. Even so, Cuba — which needs at least 110,000 barrels per day and produces only 40,000 of heavy crude suitable only for thermal power plants — is in a severe energy crisis, and blackouts are now beginning to exceed 40 uninterrupted hours in several provinces.
President Sheinbaum was asked directly about this and didn't deny it.
Asked at her regular morning press conference whether she denied a media report that Mexico had halted the shipment, Sheinbaum responded: "It is a sovereign decision and it is made in the moment when necessary."
Sheinbaum sidestepped a question about whether Mexico would resume oil shipments to Cuba, answering: "in any case, it will be reported."
She's denying this was in response to US pressure but she's not denying the shipment was stopped. This is going to greatly accelerate the economic collapse in Cuba, which was already well underway. The price of gasoline is already up.
"There's no gasoline in Havana, not even in 'Americano' (dollars)," complain drivers and residents.
Even those who had prioritized allocations, such as users with power generators, are not receiving fuel.
A mother shared that she had to purchase two liters for 1,500 pesos just to cook due to power outages. "I couldn’t buy more because the situation here doesn’t allow it," she explained.
There are two types of gas stations in Cuba. Those that accept pesos and those that accept dollars. It seems only the ones that accept dollars are getting fresh supplies of gasoline, which is a problem for people who only earn pesos.
“They haven’t supplied more in the national currency, so you have to buy in foreign currency. You well know that no one here earns in dollars,” declared a citizen who had been waiting four hours to fill his tank.
It doesn't help that Cuba's other major source of income, tourism, has also plummeted.
“This is grim,” said Reymundo Aldama, who drives a bubblegum pink 1957 convertible Ford Fairlane. “We’re waiting for them to come, we’re waiting for work.”
Tourism in Cuba is plummeting at a time when the island desperately needs that revenue, with the number of visitors dropping by more than half since 2018. For almost two decades, a steady stream of visitors sparked a boom in tourism, only for the COVID-19 pandemic and severe blackouts to hit, coupled with increased U.S. sanctions...
For decades, tourism generated up to $3 billion a year for Cuba.
Visitors would pack into restaurants, crowd along Havana’s seawall and gather at imposing monuments and state buildings. The constant flow of passengers boosted employment and led to the opening of hundreds of small businesses including hostels and restaurants.
Nowadays, the seawall is dotted mostly with Cuban couples or fishermen hoping to catch their next meal.
This is already bad but will become dire in the coming weeks. Hopefully the communist government is willing to concede this situation isn't survivable and will be willing to "made a deal" as Trump has put it.
