26 October 2026

Recently introduced new housing and oil and gas laws if effectively implemented could eventually represent significant liberalisation of their respective strategic sectors.  However, the full impact of the latest of the 176 transformations announced in June is unlikely to be felt for as long as investors continue to be deterred by US sanctions.

Energy Law invites investors, though most remain blocked

Decree-Law 135/2026[1] and accompanying regulations, published in the Gaceta Oficial No. 85 on 12 October, bring significant changes to the oil and gas sector. While oil and gas exploration and production in Cuba’s territorial waters were previously available to foreign investors, the new law alters terms, adds storage and distribution, and opens the whole sector to domestic, as well as foreign, companies.

The reform’s underlying aim is to prepare the way for Cuba to attract finance to develop its oil and gas reserves, to reverse the decline in domestic oil production. It envisages contracts for production-sharing, concessions and services, with those for production-sharing to run for up to 40 years and concessions to 30 years, with up to ten years extensions for both. Concessions for blocs for exploration and extraction of oil and gas in Cuban territorial waters are to be opened to bids with cost recovery capped at 65% of production onshore and in shallow water and 75% in deep water.

In an interview reported in Granma, the Communist Party newspaper, Irenaldo Pérez Cardoso, deputy director of the state oil company, Cuba Petróleo (CUPET) confirmed that Cuba is inviting investors to secure contracts through competitive bidding, although he also underlined that the Cuban state will continue to own the wells, refineries and major storage facilities, and retain control over project approvals and strategic infrastructure.

For the new private sector businesses that have been permitted by the US to import fuel on condition that it is sold only to non-state customers, the clarification of the legal framework, and possibly also the reduction in the minimum of qualifying companies’ working capital from US$20mn to US$5mn, may be relevant. According to the Cuban Ministry of Mines and Energy, these imports provide no more than 3% of the country’s total fuel needs, but the proportion of diesel, which is particularly scarce, will be greater. Greater regulatory clarity may encourage Cuban entrepreneurs to develop the smaller storage facilities linked to distribution services that are now formally acknowledged. The law states that, in awarding contracts, the authorities will be empowered to give preference to domestic companies. It envisages that this preferential treatment should only be given on condition that they meet quality, timing and price criteria, although this leaves open the extent of flexibility concerning such conditions.

The new law and regulations will not solve Cuba’s immediate energy shortages, and nor will they succeed in attracting international investors for as long as current US sanctions remain in effect (see below). However, they represent an advance towards liberalisation of the sector, signalling possibilities for a future if US restrictions are eased, as well as clearer regulation of the private fuel importers that have emerged in the context of this year’s US prohibition of imports by the state.

Housing market regulations extend ownership and financing possibilities

Like the energy law, Law 187 on Housing, published together with related regulations in the Gaceta Oficial Ordinaria No. 86 on 14 October, has the potential to open the way to the liberalisation of an important domestic market. The new law encompasses broad housing policy and its legal framework, including the allocation of state-owned homes, planning and building controls, land registry procedures and protection of vulnerable tenants and home-owners. Within the provisions, it acknowledges that foreign buyers and Cuban private businesses can own houses and also, crucially, defines different types of housing tenure and associated rights and obligations, as well as a range of sources of housing finance.

The housing law has been a long time in gestation. In an interview for Cubadebate, a government website, the Ministry of Construction’s Director of Legal Affairs, Marvelis Velásquez Reyes, said that the law had been under discussion for two decades. In the 1990s, a reform proposal had suggested opening the housing market to foreign investment but had been shelved. Then in 2011 a reform began to create a housing market, but with ownership only open to Cuban citizens, with domestic businesses and international buyers excluded, its growth was limited.

The new law increases the number of homes that an individual owner can acquire from one main residence to two, and as before, it permits an additional holiday home (usually by the coast or in the mountains). It sets out the rules for buying, renting, donating, exchanging and inheriting housing, and extends ownership to housing cooperatives and property businesses and, crucially, makes reference to the ownership of houses not only by real estate businesses but also by Cuban residents abroad and foreign nationals. Details are unclear, but the reform seems designed to draw in fresh finance for construction, repair and rehabilitation of the depleted and deteriorated national housing stock, from both resident and non-resident investors. The list of sources of financing include not only savings but also different types of loans available over different time periods, and subsidies for construction and renovation, with special provisions for vulnerable people, families, children, older adults, people with disabilities, and survivors of family or gender-based violence.

Given that there was surge in inflows from foreign buyers even without legal title when the economy appeared to be opening in 2015-16, the possibility of buying a home could be attractive to Cubans currently resident abroad, as well as speculators. However, the stipulation that purchases cannot be made in cash may present an obstacle for buyers who are not resident in Cuba and are unable to transfer funds into Cuban banks.

[1] CEDA and Gaceta Oficial https://www.gacetaoficial.gob.cu/sites/default/files/goc-2026-o86.pdf)

Cuba Briefing – Issue 1326

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