The geopolitical architecture of energy in the Caribbean is undergoing a fundamental transformation as Mexico officially overtakes Venezuela as the primary supplier of crude oil to Cuba. This shift represents more than a mere change in logistics; it signals a significant realignment of regional influence and highlights the deepening systemic failures within the Venezuelan energy sector. For decades, the Caracas-Havana axis served as the ideological and economic backbone of the Caribbean’s socialist bloc, anchored by the "oil-for-doctors" swap established under Fidel Castro and Hugo Chávez. However, as Venezuela’s state-owned oil giant, PDVSA, continues to grapple with decaying infrastructure, crippling international sanctions, and plummeting production, Mexico’s state-owned Petróleos Mexicanos (Pemex) has stepped into the breach, fundamentally altering the energy security landscape of the island nation.
The transition comes at a moment of acute vulnerability for the Cuban government. The island is currently navigating its most severe economic crisis since the "Special Period" of the 1990s, characterized by chronic food shortages, runaway inflation, and a crumbling electrical grid. For much of the last twenty years, Venezuela provided upwards of 100,000 barrels per day (bpd) to Cuba, often at heavily subsidized rates or in exchange for professional services. Recent data from independent tracking services and maritime analysts, however, suggests that Venezuelan shipments have dwindled to a fraction of those historical highs, occasionally dipping below 30,000 bpd. This shortfall left a catastrophic deficit in Cuba’s energy balance, one that Mexico has increasingly moved to fill under the administration of President Andrés Manuel López Obrador.
Mexico’s emergence as a benefactor to Havana is deeply rooted in the ideological "South-South" cooperation favored by the current Mexican administration. Since 2023, the volume of Mexican crude flowing to Cuban ports—specifically the refineries in Havana and Cienfuegos—has surged. Analysts estimate that Mexico has exported millions of barrels of oil to the island over the past year, utilizing a fleet of tankers that includes vessels like the Vilma and the Delsa. Unlike the transparent market transactions that define most global energy trades, the financial terms of these shipments remain opaque. While the Mexican government has characterized some of these deliveries as "humanitarian aid," the scale of the transfers suggests a more structured, albeit non-commercial, arrangement that has drawn scrutiny from both domestic critics and international observers.
The economic implications for Pemex are particularly complex. The Mexican state oil company is currently the most indebted oil firm in the world, with a debt load exceeding $100 billion. Diverting crude to Cuba—presumably at a loss or on highly favorable credit terms—represents a significant opportunity cost for a company that desperately needs cash flow to service its obligations and fund exploration. From a market perspective, every barrel of Isthmus or Maya crude sent to Cuba is a barrel not sold at market rates to refineries on the U.S. Gulf Coast or in Asia. This has prompted warnings from credit rating agencies, which view the lack of transparency regarding the Cuban shipments as a potential risk factor for Pemex’s fiscal health.
Beyond the balance sheets, the technical nature of the oil being shipped is critical to understanding the shift. Cuba’s domestic refineries were largely built or modernized to process the heavy, sour crudes typically produced in Venezuela. However, as Venezuela’s refining capacity has collapsed, the quality of its exports has become inconsistent, often plagued by high water content and impurities. Mexico, by contrast, has provided more stable, higher-quality grades that are easier for Cuba’s aging infrastructure to handle. This technical compatibility has helped the Cuban government maintain a baseline of electrical generation, though it has not been enough to prevent the frequent "apagones" (blackouts) that have sparked rare public protests across the island.
The geopolitical friction caused by this energy pivot extends directly to Washington. The United States maintains a comprehensive embargo on Cuba and has historically used sanctions to discourage third-party energy shipments to the island. While the U.S. State Department has expressed concern over Mexico’s support for the Cuban regime, it has stopped short of imposing secondary sanctions on Pemex. This restraint reflects the delicate nature of U.S.-Mexico relations, where cooperation on migration, trade, and fentanyl interdiction often takes precedence over regional energy disputes. Nevertheless, the optics of a major North American trade partner propping up the Cuban economy remain a point of contention in bilateral dialogues.
The decline of Venezuelan influence in Cuba is a poignant indicator of the broader erosion of the Petrocaribe program. Launched in 2005, Petrocaribe allowed Caribbean and Central American nations to purchase Venezuelan oil on preferential payment terms, effectively buying regional loyalty through "hydrocarbon diplomacy." At its peak, the program was a masterclass in using energy as a tool of soft power. Today, with Venezuela’s production hovering around 800,000 bpd—a staggering drop from the 3 million bpd it produced at the turn of the century—the program is a shadow of its former self. The void left by Caracas is being filled not only by Mexico but also by sporadic shipments from Russia, though the logistical challenges of transporting Siberian crude to the Caribbean make it a costly and inefficient alternative.
For Cuba, the reliance on Mexico is a precarious lifeline. The island’s energy grid is in a state of advanced systemic failure; more than 80% of its thermoelectric plants are over 40 years old, well past their intended operational lifespan. Even with a steady supply of Mexican crude, the inefficiency of these plants means that a significant portion of the energy potential is lost. To mitigate this, Havana has increasingly relied on "floating power plants"—Turkish-owned powerships moored in Cuban harbors that burn heavy fuel oil to feed the national grid. These ships provide a flexible but expensive solution, and their operation is entirely dependent on a continuous supply of fuel, making the shipments from Mexico even more vital.
Economic analysts point out that the current arrangement may face a shelf life tied to Mexico’s political calendar. With Mexico moving toward a transition in leadership, the sustainability of "oil diplomacy" will be questioned. A future administration might prioritize Pemex’s fiscal recovery over ideological solidarity, potentially leaving Cuba in an even deeper energy vacuum. Furthermore, the global push toward an energy transition poses a long-term threat to Cuba’s oil-dependent model. While other Caribbean nations are exploring liquefied natural gas (LNG) and solar arrays to diversify their energy mix, Cuba remains tethered to a 20th-century oil-burning infrastructure that it can neither afford to maintain nor replace.
The broader impact on the Caribbean energy market is also notable. As Mexico diverts supply to Cuba, other regional players are looking toward the emerging oil powers of the Guyana-Suriname basin. Guyana, which has seen an unprecedented explosion in production thanks to offshore discoveries by ExxonMobil, is rapidly becoming the new center of gravity for South American energy. While Guyana currently exports primarily to global markets, there is increasing talk of a regional "energy security" pact that could eventually offer a market-based alternative to the subsidized models of the past.
In conclusion, the rise of Mexico as Cuba’s premier oil supplier marks the end of an era dominated by Venezuelan largesse and the beginning of a more fragmented, uncertain period for the island’s economy. This shift underscores the fragility of energy security when it is built on ideological foundations rather than market realities. As Mexico continues to balance its domestic financial crisis with its regional ambitions, and as Venezuela’s oil industry remains in a state of managed decline, Cuba finds itself at a crossroads. The barrels arriving from Mexican ports are keeping the lights on in Havana for now, but they do little to address the underlying structural rot of an economy that has yet to find a sustainable path forward in the post-Petrocaribe world. The "Mexicanization" of Cuba’s energy supply is a temporary reprieve, a geopolitical maneuver that highlights the volatility of a region where oil remains the ultimate currency of political survival.
