What the oil dream can do - Cuba walks a change path

By Shahab Sabahi

Energy and Environment - Policy analysis research group

The United States geological survey, considers that the seas around Cuba hold 4.6 billion barrels of crude oil. This is very deep water reserve. In 2004, Repsol struck oil there, but found out the extraction would not be profitable. Any new discovery would take years to exploit. (the Economists)
Now the world demand for energy exponentially rises. Consequently energy security is going to be a pressing issue for states. Even the spots with small amount of fossil stock appeal state authorities
Cuba, with centralized planner and a communist system, is not exceptional. The need for foreign investment makes Cuba seeks investment from China, Brazil and India which have already offered a multi-billion-dollar credit line. Cuba’s government is trying to find a way-out from its existing political structure, to give ways for more efficient private engagement in the country’s economic affair. In recent movements, the government cut food imports by leasing land to private farmers. The government granted 221,000 licenses for small businesses (The Times) since October last year, to make the island more attractive for foreigners to visit and Cuban-Americans to retire.
But Cuba’s main hope of economic independence is OIL. A $750m drilling rig is underway to live up this hope. It built in China with no American parts to avoid falling foul of the United States’ economic embargo against the island. Cuba will celebrate the rig presence in its waters by the end of the year. Spain’s Repsol will drill an exploratory well the early 2012.
If the oil hope comes true and then Cuba’s reforms take momentum, Cuba may be a rather different place.