Russia and Cuba are exploring a major new project: building an oil refinery in Cuba with the help of Russian companies. This plan could turn Cuba into a key player in oil production, rather than relying on dwindling supplies from Venezuela. With Cuba struggling with severe fuel shortages and skyrocketing prices, the new refinery could be a game-changer. If the deal goes through, it could not only ease Cuba’s energy crisis but also strengthen the long-standing ties between the two nations.

According to a comment from the deputy speaker of the Russian parliament, Russia and Cuba have discussed the possibility of constructing an oil refinery in Cuba with the assistance of Russian businesses.

Deputy Speaker Alexander Babakov was quoted by Russia’s TASS news agency as saying that the concept of building a refinery has been discussed during a recent visit by Russian MPs to Cuba reports OilPrice.com.

“The biggest Russian state companies could be working here,” the lawmaker said.  

“Cuba has crude oil: it is logical not to import oil products but to produce them here,” TASS quoted Babakov as saying.

Since the 1950s, when the Soviet Union and the Latin American nation increased their connections as fellow communist governments, Russia and Cuba have maintained tight relations.

Venezuela, which lies close by, is Cuba’s main source of crude oil.

But recent years have seen a decline in supplies, partly because of Venezuela’s collapsing oil production and US sanctions against Cuba’s longtime friend, Nicolas Maduro of Venezuela.

Less fuel oil from Venezuela, which has the greatest oil reserves in the world, is reaching Cuban coasts to power the island’s outdated power plants as a result of the country’s collapsing oil industry.

The International Energy Agency (IEA) states that over 80 percent of Cuba’s energy supply is derived from oil products, which are the primary source of the island nation’s power generation.

In 2021, the Venezuelan oil industry crisis sparked widespread riots in Cuba.

Cuba, which has experienced ongoing shortages of gasoline and other energy, said earlier this year that fuel prices would increase by 500% starting on February 1, 2024.

Almost all basic products and services are now subsidized at prices that the Cuban government is unable to maintain.

Since 2022, Cuba has also purchased some Russian crude. After that, there was a one-year pause until March of this year, when some Russian oil finally made its way to Cuba.

Last month, GreatGameInternational reported that after Russia’s invasion of Ukraine in February 2022, Western nations imposed harsh restrictions on Russian oil imports. This has led to a significant shift in global trade, with countries like China, India, and Turkey increasing their oil imports from Russia.