As if tensions between the United States and Russia were not high enough, the Russian government-owned oil corporation Rosneft is now seeking a major oil deal with Cuba. At the World Petroleum Congress in Moscow, Rosneft met with Cuban Deputy Minister of Energy and Mines, Ruben Cid, to discuss new oil fields right in America's backyard.
Cid told Itar-Tass, "Talks with Russian oil corporations are underway at the moment. The Director General of our national oil company CUPET, Juan Torrez Naranjo, and Rosneft President Igor Sechin signed a memorandum recently in St Petersburg, under which the two companies will do the joint development of oilfields on the Cuban continental shelf.”
If the deal continues, it will mean two government-owned oil companies with roots in communism will build a meaningful business relationship. Cuba has oil reserves of somewhere between four and 20 billion barrels. CUPET estimates 20 billion, whereas the United States Geological Society has a more modest estimate of four-to-nine billion barrels.
Right now, oil is priced around $110 per barrel. This is quite a lucrative deal, comparable even to the $900 billion deal Rosneft currently has underway with Exxon Mobil. In that arrangement, Arctic drilling should bring in nine billion barrels of oil.