Cuba oil presents US dilemma

The discovery of potential deep-water oil and gas reserves off Cuba’s northern coast has caught the eye of the world’s energy-hungry nations. The US could see rigs drilling for Cuban oil only 50 miles off Florida.

Cuban President Raoul Castro

Cuban President Raoul Castro

India’s state-run oil firm ONGC, already signed up to exploration in the area, has just upped its stake – the latest to place its bets on a Cuban oil rush.

The 44-year-old US trade embargo, meanwhile, continues to bar American companies from doing business with the Caribbean island. But, observers are asking whether the US can afford to risk losing out on valuable energy resources only 80km from Florida.

The prospect of nations such as China, Venezuela or India lining up to exploit Cuban oil has already led some US politicians to call for the embargo to be relaxed. They want US oil companies to bid for exploration rights – and for environmental laws to be relaxed to allow drilling in the adjoining US waters.

Others insist the embargo must remain in force to keep pressure on Cuba’s government over human rights. However, the US had better move fast in securing a chunk of Cuba’s estimated 20 billion barrel oil reserves.

According to BBC news, the European Union has just restored ties with Cuba, five years after diplomatic sanctions were imposed following mass arrests of dissidents by the Cuban government. European Commissioner Louis Michel said the accord he signed with Cuban Foreign Minister Felipe Perez Roque was “a turning point for EU-Cuban relations”.

Mr Perez Roque welcomed the EU’s respect for the island’s political independence.  Cuba will now receive 2 million Euros ($2.6m) of emergency hurricane recovery aid, with 30m euros ($38.9m) available next year.

The discovery of a major oil field in the communist state, coupled with initiatives to develop alternative energy projects, such as a new biogas factory, will put Cuba on the fast track to achieving energy independence.

If it in fact has 20 billion barrels of oil offshore, Cuba would slingshot into the top 20 oil producing nations worldwide. Cuba plans to start drilling next year for reserves located in the Gulf of Mexico, north of the island.

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With reports by Peak Oil News, BBC News and EcoWordly
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One Response

  1. With a new Obama administration set to take over power in Washington, I hope that President Obama will move remove US trade embargoes slapped on Cuba and ease diplomatic tensions so that normalization of relations can be restored not just for the sake of a slice of the oil cake but for the good of world peace. Expectations are high on the international scene to see how President-elect Obama will move to ease and restore relations with traditional enemies like Cuba, Iran and North Korea but we are optimistic that he and his team of chosen advisers are equal to the task ahead.

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