# Cuba strikes oil! **URL:** \ **Category:** Great Debates\ **Created:** [July 30, 2006, 8:16pm UTC](https://boards.straightdope.com/t/cuba-strikes-oil/366595 "2006-07-30T20:16:58Z")\ **Posts on this page:** 12\ **Page:** 3
**Author:** ![BrainGlutton](https://avatars.discourse-cdn.com/v4/letter/b/82dd89/32.png) [@BrainGlutton](https://boards.straightdope.com/u/BrainGlutton)\ **Post date:** [August 1, 2006, 2:26am UTC](https://boards.straightdope.com/t/cuba-strikes-oil/366595/41 "2006-08-01T02:26:39Z")
> [@NaturalBlondChap](#): > > With a hoard of docs trying to get an elastoplast on FCs gut and a potential change of leadership, it all works out rather well. FC does not have to back down, the US does not have to be seen to compromise and deal with FC and the new guy (well slightly less old guy) can step in and claim a victory for himself and change with the times without loosing face. > Largish oil turns up and invests a bucket of cash followed by other ancillary industries, tourism should be ok on its own and thus ends one of the more pointless embargos with face saved all around and a few can enjoy puffing away. > Everyone gets what they need and live happily ever after. That might have worked – before Castro buddied up with Hugo Chavez – who is now [buddying up with Belarus, Russia, and Iran.](http://boards.straightdope.com/sdmb/showthread.php?t=381211) Things are more complicated now. ---
**Author:** ![Der\_Trihs](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/der_trihs/32/233_2.png) [@Der\_Trihs](https://boards.straightdope.com/u/Der_Trihs)\ **Post date:** [August 1, 2006, 2:30am UTC](https://boards.straightdope.com/t/cuba-strikes-oil/366595/42 "2006-08-01T02:30:22Z")
> [@LonesomePolecat](#): > > What Steve said. Plus, after Iraq, an invasion or other military action against Cuba is really gonna be hard to sell. If the people in charge had either principles or common sense, I might dismiss the possibility as highly unlikely; as it is, I consider it quite likely. Stupid, and guaranteed disaster, but likely. ---
**Author:** ![guizot](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/guizot/32/3636_2.png) [@guizot](https://boards.straightdope.com/u/guizot)\ **Post date:** [August 1, 2006, 2:35am UTC](https://boards.straightdope.com/t/cuba-strikes-oil/366595/43 "2006-08-01T02:35:50Z")
> [@BrainGlutton](#): > > But Cuba would be a **fun** invasion! Practically a vacation after Iraq! All those hot chicks, hot music, dance clubs, mojitos . . . Sign me up now! > [@NaturalBlondChap](#): > > I would disagree, > both venezuelan and the current production from Cuba is heavy and sour, needing somewhat specialised refining and desulphurisation (if that is a word). This is the same case for Russian Ural oil and most of what is produced in the Middle East region. Yes, that’s [what I’ve read](http://www.progressive.org/mag_intv0706). > [@Greg Palast](#): > > Venezuela, Chávez told me, has more oil than Saudi Arabia. A nutty boast? Not by a long shot. In fact, his surprising claim comes from a most surprising source: the U.S. Department of Energy. In an internal report, the DOE estimates that Venezuela has five times the Saudis’ reserves. > > However, most of Venezuela’s mega-horde of crude is in the form of “extra-heavy” oil—liquid asphalt—which is ghastly expensive to pull up and refine. Oil has to sell above $30 a barrel to make the investment in extra-heavy oil worthwhile. A big dip in oil’s price—and, after all, oil cost only $18 a barrel six years ago—would bankrupt heavy-oil investors. Hence Chávez’s offer: Drop the price to $50—and keep it there. That would guarantee Venezuela’s investment in heavy oil. So what **BlondChap** says. . . > [@](#): > > To my knowledge (not a huge) it is not clear if the geological structures that provide the deepwater gulf of mexico oil light crude and condensate extend to the cuba basin. If they did then it is going to be expensive, very very expensive, to develop. The people with the cash and (very importantly) the technical knowlege to develop these potential fields are the likes of Exxon, BP, Shell. They in turn are unlikly to start shelling out the cash with the uncertain future political stability. . . . is on the mark. ---
**Author:** ![Precambrianmollusc](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/precambrianmollusc/32/63_2.png) [@Precambrianmollusc](https://boards.straightdope.com/u/Precambrianmollusc)\ **Post date:** [August 1, 2006, 3:15am UTC](https://boards.straightdope.com/t/cuba-strikes-oil/366595/44 "2006-08-01T03:15:35Z")
> [@BrainGlutton](#): > > That might have worked – before Castro buddied up with Hugo Chavez – who is now [buddying up with Belarus, Russia, and Iran.](http://boards.straightdope.com/sdmb/showthread.php?t=381211) Things are more complicated now. Evening Mr Glutton, but damnit I have no idea which thread to respond into now. My take - Belarus can squark all it likes, it is not on any major supply routes for oil for europe, it does not provide any significant commodities the western world needs and it is broke. Its sole function is to to be a noisy little boy that Russia can get some leverge with the EU and US by making noises about keeping it under control. It may have some stray nuclear weapons and probably has enough lost radioactive material to sell off to get some hard currency with. It is also landlocked and has no strategic or tactical connections with chavez or cuba, they can send supportive telegrams but that is all. Cuba and Chavez, well as some have mentioned in the other thread , Chavez wants to be the new Bolivar of south america, and given the way SA was used and the amount of nastiness that has been pulled by the US down this way, I can understand why people will support anyone who is actively anti US. However despite all the vitriol money spits harder. Cuba needs money. They can side with Chavez and they will be dependent on handouts from a rapidly failing economy. The easy oil from venezuala has largly gone, and PDVSA that was a very technically competent company is now a shell of its former self. Many of the people who worked there are now black listed and anyone who works in the oil industry outside of venezula cannot work back in venezula - they are also blacklisted from employment with PVDSA. So if you will give me the position that Venezuala is on a spiral down the well bore relying on Chavez for a handout may not be a good policy. If the oil is there (and for the hellof it lets assume they find a stonking great light crude discovery somewhere) Cuba needs to sell it to someone, Belarus has no money, chavez doesn’t need it and as for the rest of SA, Brazil is a net exporter, Argentina is currently a net exporter (due to change in a few years unless they sort out some labour reforms and subidised gas issues) and thd rest are small economies or self sufficent in gas or oil. (apologies if that sounds unfairly dismissive) Cuba other options - West africa? Nope they are net exporters or have closer supplies. Europe - most of imported oil is from Russia and ex USSR states, if they see their market fro their oil is thretened by imports from cuba, I would suggest comradly love does not extend that far and they will shut it down. Besides , land pipelines for azerbaijan and russia (not the south caucus pipeline) vs , tankers accros the atlantic, if I were a refiner I would be adding cost to the cuba oil purely for risk. Asia (specificaly japan or china) - you would need a pipe line across SA or a long voyage around cape horn, not somethong to be considered lightly in an oil tanker. All of a sudden oil is not that fungible when it comes down to getting it to the refinary. That leaves the US, close by, reliable for paying their bills, and they are willing to buy. So vitriol or cash, my bet is the new dude goes with a hmmming and harung vocal support with chavez, but sells up to largish oil. just my humble opinion, if the above read as being abrasive or agressive, it was not intended that way. If it is missing punctuation or the spelling is bad, all I can say is it was fine when I hit the send button, the hamsters must have eaten the commas and made a mess of the letters. NBC ---
**Author:** ![Precambrianmollusc](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/precambrianmollusc/32/63_2.png) [@Precambrianmollusc](https://boards.straightdope.com/u/Precambrianmollusc)\ **Post date:** [August 1, 2006, 3:39am UTC](https://boards.straightdope.com/t/cuba-strikes-oil/366595/45 "2006-08-01T03:39:12Z")
Guizot to clarify a point that may or may not need clarifying. Greg Palast made an excellent point which is in reference to the current Cuba production of heavy oil - it sells at a marked discount and it is a pain in the butt to produce and refine and it is unlikely that any western oil cos would bother to get involved if that is all that there was (and has been for some years now) on offer. With improved understanding of the Gulf of mexico basin and the deep water light crude and condensate discoveries, if such reserves exist in Cuba they will sell for a fricking fortune but likely to be found in deep water. Condensates typically trade above benchmark levels. Now the deepwater vs shallow heavy oil is an interesting connundrum. Deepwater will require massive upfront investment in topside facilities and drilling (400K a day rig cost and each well in the order of 50-100 million) that will pay out big time down the line (in production rates and value of product) , enough to significantly offset the time value of money effects. However you need the money in the bank upfront or a helluve of nice bank manager. (chavez is nice but he does not have that much spare cash (no cite just my opinion) Heavy crude as they have (and also most canadian crude is ultra heavy requiring steam assisted drainage) does have a higher lift cost per bbl, but the wells are cheaper to drill and the costs match the return cycle much more closely. So you don’t need so much money tied up in advance. So Canadian land producers (and PVDSA) do not need to tie up limited cash flows up front and make a modest return which is more susceptble to price fluctuations. hope that made sense (or if it was a redundant clrification please ignore) ---
**Author:** ![Little\_Nemo](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/little_nemo/32/3120_2.png) [@Little\_Nemo](https://boards.straightdope.com/u/Little_Nemo)\ **Post date:** [August 1, 2006, 4:25am UTC](https://boards.straightdope.com/t/cuba-strikes-oil/366595/46 "2006-08-01T04:25:34Z")
> [@](#): > > Bush should do it since he’s lame duck and doesn’t have to worry about ex-Cuban Florida votes. But if the President does piss off the Cuban emigres, he’ll hurt his brother. ---
**Author:** ![alphaboi867](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/alphaboi867/32/3898_2.png) [@alphaboi867](https://boards.straightdope.com/u/alphaboi867)\ **Post date:** [August 1, 2006, 4:36am UTC](https://boards.straightdope.com/t/cuba-strikes-oil/366595/47 "2006-08-01T04:36:55Z")
> [@Little Nemo](#): > > But if the President does piss off the Cuban emigres, he’ll hurt his brother. Is Jeb running for a third term as governor? If not he’s every bit the lame duck Georgie boy is. ---
**Author:** ![BrainGlutton](https://avatars.discourse-cdn.com/v4/letter/b/82dd89/32.png) [@BrainGlutton](https://boards.straightdope.com/u/BrainGlutton)\ **Post date:** [August 1, 2006, 5:32am UTC](https://boards.straightdope.com/t/cuba-strikes-oil/366595/48 "2006-08-01T05:32:45Z")
> [@alphaboi867](#): > > Is Jeb running for a third term as governor? Not allowed in this state. Jeb has publicly declared he has no intention of running for prez in '08. Not that he mightn’t find a way to weasel around that . . . ---
**Author:** ![alphaboi867](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/alphaboi867/32/3898_2.png) [@alphaboi867](https://boards.straightdope.com/u/alphaboi867)\ **Post date:** [August 1, 2006, 5:44am UTC](https://boards.straightdope.com/t/cuba-strikes-oil/366595/49 "2006-08-01T05:44:56Z")
> [@BrainGlutton](#): > > Not allowed in this state. > > Jeb has publicly declared he has no intention of running for prez in '08. Not that he mightn’t find a way to weasel around that . . . Hmm, Jeb Bush as the Republican candidate in 2008…how much can I donate and where do I send the check? 😃 ---
**Author:** ![BrainGlutton](https://avatars.discourse-cdn.com/v4/letter/b/82dd89/32.png) [@BrainGlutton](https://boards.straightdope.com/u/BrainGlutton)\ **Post date:** [August 1, 2006, 5:46am UTC](https://boards.straightdope.com/t/cuba-strikes-oil/366595/50 "2006-08-01T05:46:57Z")
> [@alphaboi867](#): > > Hmm, Jeb Bush as the Republican candidate in 2008…how much can I donate and where do I send the check? 😃 :dubious: I remember saying or at least thinking that about George W. Bush in 2000. And about George H.W. Bush in 1988. Be careful what you wish for. ---
**Author:** ![if6was9](https://avatars.discourse-cdn.com/v4/letter/i/e47c2d/32.png) [@if6was9](https://boards.straightdope.com/u/if6was9)\ **Post date:** [August 1, 2006, 7:00am UTC](https://boards.straightdope.com/t/cuba-strikes-oil/366595/51 "2006-08-01T07:00:14Z")
> [@Patty O'Furniture](#): > > However Florida produces something that the Republical Party dearly needs. Faulty ballots? ---
**Author:** ![BrainGlutton](https://avatars.discourse-cdn.com/v4/letter/b/82dd89/32.png) [@BrainGlutton](https://boards.straightdope.com/u/BrainGlutton)\ **Post date:** [August 2, 2006, 3:08am UTC](https://boards.straightdope.com/t/cuba-strikes-oil/366595/52 "2006-08-02T03:08:24Z")
> [@NaturalBlondChap](#): > > They can side with Chavez and they will be dependent on handouts from a rapidly failing economy. The easy oil from venezuala has largly gone, and PDVSA that was a very technically competent company is now a shell of its former self. Many of the people who worked there are now black listed and anyone who works in the oil industry outside of venezula cannot work back in venezula - they are also blacklisted from employment with PVDSA. Cite? [Previous page](https://boards.straightdope.com/t/cuba-strikes-oil/366595.md?page=2)