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REFILE-Cuba's acute fuel shortage begins to bite

Reuters | Havana | Updated: 14-09-2019 03:43 IST | Created: 14-09-2019 03:42 IST
REFILE-Cuba's acute fuel shortage begins to bite
Image Credit: Pixabay

Cubans queued for hours for public transport on Friday at peak times in Havana, sweating in the heavy heat, while queues at gas stations snaked several blocks long, as a fuel shortage that the government blames on U.S. sanctions began to bite. Inspectors flagged down workers with state cars or trucks to get them to pick others up after President Miguel Diaz-Canel's exhortation for Cubans to show solidarity in these times of crisis and everyone do their bit to improve fuel efficiency.

He warned Cubans on Wednesday on state television of difficult times ahead as U.S. attempts to block fuel shipments to Communist-run Cuba meant there would be less diesel than usual available this month. The government has agreed a series of measures to ensure basic services, he said. Some energy-intensive investments would be postponed, some train and bus services would be suspended and those who could work from home should.

The crisis should only be temporary though, he assured, with shipments for October guaranteed. "The transport situation is getting ugly, even if the state says it is only temporary," said Alexei Perez Recio, 55, who was fixing up a bicycle he had not used since the economic depression in Cuba following the fall of former benefactor the Soviet Union when public transport collapsed.

"I have to have (my bike) ready." The Communist government has assured Cubans this is not a return to those dark days as the economy is more diversified now, having opened up to tourism and foreign investment, and developed its own oil industry.

Still, this is a sign of the worsening of Cuba's economic situation. The government started rationing energy several years ago due to a decline in subsidized oil shipments from leftist ally Venezuela, cutting street lighting and the use of electricity in state-run institutions. The Trump administration's tightening of the decades-old embargo on Cuba's already inefficient state-run economy has only worsened its economic situation and ability to pay for energy from elsewhere.

New U.S. sanctions imposed on Venezuela's state-run oil firm PDVSA in January have also made it harder for it to send oil shipments to Cuba. Cuba and Venezuela's joint company, Transalba, for leasing and operating vessels covering the route between the two nations, has struggled to find enough tankers, captains and crew willing to work with two sanctioned countries, according to shipping sources involved in the trade.

Some PDVSA ships, including the Manuela Saenz, Icaro, Terepaima and Yare, have had to complement the fleet. As such the flow of Venezuelan crude and fuel to Cuba has remained mostly stable this year, averaging 55,300 barrels per day (bpd) from February through August, according to Reuters calculations based in Refinitiv Eikon vessel tracking data and PDVSA's export programs.

But Diaz-Canel said some of the negotiations to secure enough ships for September - without referring explicitly to shipments from Venezuela - had fallen through. "I waited around three hours to catch a bus home yesterday," said Eloisa Alvarez, 72, waiting with dozens of others at a bus stop where policemen and inspectors organized buses, state cars and even trucks to pick up people.

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