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By Andre Pienaar
Executive order establishes secondary-sanctions-style mechanism targeting any country that sells petroleum to Cuba
WASHINGTON — President Donald Trump signed an executive order on Wednesday declaring a national emergency with respect to Cuba. The order establishes an unprecedented tariff mechanism designed to sever the island’s access to foreign oil by penalising supplier nations with duties on their US-bound exports.
The order, which took effect today, invokes the International Emergency Economic Powers Act (IEEPA) and the National Emergencies Act (NEA) to authorise additional ad valorem tariffs against any country determined to “directly or indirectly” sell or provide oil to Cuba.
The action represents a significant escalation in US economic pressure on the authoritarian regime ruling Cuba. The executive order introduces a novel enforcement architecture that functions similarly to secondary sanctions, but operates through the tariff system rather than Treasury Department designations.
Counter-terrorism and espionage
The executive order’s national security findings centre on Cuba’s relationships with US adversaries. The administration specifically cited Cuba’s hosting of Russia’s largest overseas signals intelligence facility, which the order states “tries to steal sensitive national security information of the United States”.
The order also references deepening Cuban intelligence and defence cooperation with China. It accuses the regime and its intelligence services of providing a “safe environment” for Hamas and Hezbollah to “build economic, cultural, and security ties throughout the region and attempt to destabilise the Western Hemisphere”.
How the tariff mechanism works
The order creates a multi-step process for imposing tariffs on oil-supplying nations.
First, the Secretary of Commerce determines whether a foreign country sells or provides oil to Cuba, either directly or through intermediaries. The order defines “indirectly” to include sales through third parties where the seller has “knowledge that such oil may be provided to Cuba”.
Following an affirmative Commerce finding, the Secretary of State, consulting with Treasury, Commerce, Homeland Security, and the US Trade Representative, recommends whether to impose additional duties and at what rate.
The President then decides whether to act on the recommendation.
This structure gives the administration substantial discretion in both identifying target countries and calibrating the economic response, allowing for differentiated treatment based on diplomatic considerations.
Countries in the crosshairs
The order does not name specific countries, but its practical effect will depend on which states currently supply Cuba with petroleum.
According to the Financial Times, Mexico supplied approximately 44 per cent of Cuba’s oil imports, while Venezuela supplied 33 per cent until last month. Around 10 per cent is sourced from Russia, with a smaller amount from Algeria, according to the same reporting.
Venezuela has historically been Cuba’s primary oil supplier, providing crude under preferential terms in exchange for Cuban medical personnel and intelligence cooperation. This relationship has continued despite existing US sanctions on Venezuelan oil exports, often through ship-to-ship transfers and other evasion techniques.
Russia has emerged as a supplemental supplier in recent years, with tanker shipments documented arriving at Cuban ports. Mexico has also reportedly provided petroleum products to Cuba at various points, though the scale and current status of such supplies remain unclear.
The inclusion of “indirect” sales within the order’s scope raises questions about how the administration will treat countries that serve as transhipment points or whose flagged vessels carry Cuban-bound cargo.
Legal and policy precedents
The order’s use of IEEPA to authorise tariffs rather than asset freezes or transaction prohibitions represents a novel application of the statute’s broad emergency economic authorities. Previous administrations have primarily used IEEPA for sanctions programmes administered by the Treasury Department’s Office of Foreign Assets Control.
The tariff-based approach may offer certain advantages over traditional sanctions. Tariffs generate revenue rather than simply blocking transactions, and they impose costs on foreign governments through reduced export competitiveness rather than requiring US persons to police their business relationships.
Implications for regional energy flows
The executive order further shapes ongoing changes to energy security in the Western Hemisphere. Venezuela remains under comprehensive US sanctions, and the administration has signalled a tougher enforcement posture.
Cuba’s energy sector has struggled for years, with rolling blackouts becoming increasingly common as ageing infrastructure deteriorates.