Cuban Oil Law Revamp Seen as "Conciliatory Gesture" Towards Trump Administration, Experts Say

This week, the Cuban government enacted a new oil and gas regulation, which analysts see less as a genuine economic reform and more as a political signal aimed at the United States. According to a report by Martí Noticias, the new "Oil and Gas Decree-Law 135/2026" and its accompanying regulation (Decree 184/2026) were made public on Monday in the Official Gazette and will take effect on October 19.

The new legislation repeals the 1938 Law of Combustible Minerals and the 1959 Law 635, marking the first update in nearly ninety years to the island's legal framework for hydrocarbons. It formally allows foreign investors and national private entities—such as small and medium-sized enterprises and cooperatives—to participate in oil and gas exploration and production. However, the deposits remain "socialist property of all the people," with no transfer of ownership.

Opening Doors for Foreign Investment

The law introduces shared production contracts valid for up to 40 years, with possible extensions of 10 years, and oil concessions of up to 30 years. Cost recovery limits are set at 65% of gross production onshore and in shallow waters, and up to 75% in deep waters. Concessions will preferably be awarded through open public tenders.

Pedro Abigantus León, Director of Investments and Business for Oil and Gas at the Ministry of Energy and Mines, stated that the new regulation aims to "confirm and expand the opening to foreign investment with legal security."

A Political Maneuver Amidst Economic Isolation

However, experts consulted by Martí Noticias offer a more political interpretation. Emilio Morales, an economist and president of The Havana Consulting Group, directly stated, "The regime feels suffocated: its main partners have withdrawn, and it no longer receives credits from political allies. In this context, the new decree seems more like a conciliatory gesture towards the Trump administration than a genuine attempt to attract other investors."

Morales highlights an unprecedented level of isolation. Following the capture of Nicolás Maduro earlier this year, Venezuelan crude shipments, which exceeded 96,000 barrels per day in 2011 but had dropped to about 26,500 in 2025, were completely halted since mid-December. Pemex also suspended shipments due to tariff risks imposed by Washington. CUPET’s national production, a mere 40,000 barrels per day, covers only a third of domestic demand, estimated between 90,000 and 110,000 barrels per day.

Economic Pressures and Sanctions

In addition to energy pressures, financial sanctions have been applied: the U.S. State Department sanctioned CUPET in June 2026 under Trump’s Executive Order 14404, freezing its assets in the United States and banning transactions with U.S. citizens. CUPET and CIMEX, both under the military-business conglomerate GAESA, control virtually the entire petroleum value chain and are closed to Western capital.

Jorge Piñón, senior researcher at the University of Texas Energy Institute, warns that attracting genuine investment requires more than a new legal text. In his analysis published in Diario de Cuba, he argues, "For Cuba to have an open, independent, and efficient fuel distribution and marketing segment, it needs to restructure its current monopolistic petroleum value chain model."

This reform is part of a package of 176 economic measures announced by Prime Minister Manuel Marrero Cruz in June, complemented by the removal of the 100-worker limit for private companies approved in September, which expands the universe of entities that can aspire to concessions.

For Morales, the underlying intention is clear: "Havana is isolated and realizes that its survival depends on reaching an agreement with Washington. Opening up the oil reserves could be a lure to avoid an intervention that today seems the only real option on the table."