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Cuba tries to keep the lights on
Consumption; Demand; PricesCuba gets plenty of oil from Venezuela. So why is it adopting "extreme measures" to avoid blackouts?

...Cuba is one of more than a dozen nations in the region that receive oil shipments on favorable credit terms as part of the PetroCaribe agreement. Cuba pays Venezuela back for some of the oil shipments by sending more than 30,000 doctors, nurses and other professionals to work in social programs created by the Chavez government.

But just as Cuba’s petroleum trade has soared, revenue is plummeting from other key exports like nickel, pharmaceuticals and tobacco products. Foreign trade is down 36 percent this year, as the global recession and $10 billion in damage from three 2008 hurricanes have drained Cuba’s finances.


Thus, analysts say, the more oil Cuba can save, the more it can sell abroad.

“I think it is actually a prudent effort on the part of the government that acknowledges the reality that Cuba is in dire need of hard currency,” said Jonathan Benjamin-Alvarado, a U.S. expert on Cuban energy at the University of Nebraska at Omaha.

“The extent to which they can conserve or curb consumption in order to reserve refined fuels for re-export is logical, but yet another hardship for the people,” he added.

Global Post

Posted on Friday, November 20 @ 10:19:39 PST by Leanan
 
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