New Executive Order Opens Door To Tariffs On Countries Selling Or Supplying Oil To Cuba

Highlights

• President Donald Trump on January 29, 2026, signed an executive order (EO) that, upon declaring a national emergency on Cuba under the International Emergency Economic Powers Act (IEEPA), authorizes tariffs on goods from countries that sell or provide oil to Cuba.
• The EO also orders the U.S. Department of State Secretary and U.S. Department of Commerce Secretary to take all necessary actions to implement a new tariff regime under the IEEPA.
• Heavily dependent on oil imports, Cuba is experiencing a severe energy crisis in the wake of Nicolás Maduro's removal from power in Venezuela. With Mexico now supplying more oil to Cuba than any other country, the EO poses a risk for additional U.S. tariffs imposed on Mexican products, which would likely impact the U.S.-Mexico trade relationship.
• It is anticipated that the Trump Administration and U.S. Congress will adopt further measures to increase economic and diplomatic pressure on the Cuban government.

President Donald Trump on January 29, 2026, signed an executive order (EO), "Addressing Threats to the United States by the Government of Cuba," which authorizes tariffs on goods from countries that sell or provide oil to Cuba, a significant escalation in the decades-long efforts by the U.S. to topple the communist regime and restore democracy to Cuba.

Cuba, which is heavily dependent on oil imports, is experiencing a severe energy crisis in the wake of Nicolás Maduro's removal from power in Venezuela. Now that the Cuban government can no longer count on Caracas for oil, it has been looking to other countries in the region to fill the gap – particularly Mexico. The EO paves the way for the U.S. to impose additional tariffs on imports from any country that directly or indirectly provides oil to Cuba and orders the U.S. Department of State Secretary and U.S. Department of Commerce Secretary to take all necessary actions to implement a new tariff regime under the International Emergency Economic Powers Act (IEEPA), 50 U.S.C. § 1701 et seq.

In declaring a national emergency under IEEPA, the EO describes the "extraordinary actions" taken over the years by the government of Cuba that "directly threaten the safety, national security, and foreign policy of the United States," including alignment with and support of hostile countries, transnational terrorist groups and other malign actors, including Russia, China, Iran, Hamas and Hezbollah. It also recounts the human rights violations, repression, political persecution, torture, lack of freedom and misery that the Cuban people have endured for so many years, which the EO describes as "depredations."

To address the national emergency, the EO:

• creates a process for the potential imposition of additional ad valorem duties on goods imported into the U.S. that are products of "any other country that directly or indirectly sells or otherwise provides any oil to Cuba"
• directs the Commerce Secretary, in consultation with the Secretary of State and other senior officials, to identify any foreign country that "directly or indirectly" sells or "otherwise provides any oil to Cuba," including through intermediaries or third countries "with knowledge" that such oil may be provided to Cuba
• instructs the Commerce Secretary and Secretary of State to issue any new rules, regulations, guidance, and other determinations or actions "necessary or appropriate to implement" the EO
• following the findings by the Commerce Secretary identifying countries selling or supplying oil to Cuba, instructs the Secretary of State, in consultation with the U.S. Department of the Treasury Secretary, Commerce Secretary, U.S. Department of Homeland Security Secretary and U.S. Trade Representative (USTR) to determine whether and to what extent an additional ad valorem rate of duty should be imposed on products of the foreign country found to be directly or indirectly selling or providing oil to Cuba
• provides for recommendations from the Secretary of State with respect to countries that warrant imposition of additional tariffs and requires the Secretary of State to "monitor the circumstances" in Cuba and inform President Trump "of any circumstance that, in his opinion, might indicate the need for further Presidential action to deal with the national emergency" declared in the EO
• requires the Commerce Secretary to monitor countries that directly or indirectly sell or provide oil to Cuba

As a result, agency findings and recommendations would precede any additional tariffs imposed under the EO.

Further Actions

This is the second time in the past year that the president has tasked executive branch agencies with determining what – if any – tariffs are appropriate to address a geopolitical issue in the region. In March 2025, President Trump issued an EO, "Imposing Tariffs on Countries Importing Venezuelan Oil," but left it to the Secretary of State to decide which countries would face the tariff. To date, no tariffs have been imposed pursuant to that order. The president relied upon IEEPA as the legal authority for the Cuba-related tariff system – although the extent to which the law authorizes tariffs is currently being litigated in the U.S. Supreme Court.¹ On November 5, 2026, the Supreme Court heard oral argument on President Trump's authority to impose tariffs under IEEPA, and a ruling is expected imminently. A ruling determining that President Trump has exceeded his authority under IEEPA to impose broad tariffs by executive action could jeopardize tariffs imposed on countries selling or providing oil to Cuba as authorized under the new EO.

The Trump Administration's enactment of new trade restrictions aimed at cutting off Cuba's oil supply comes on the heels of the removal of Maduro from power in Venezuela and U.S. efforts to control the sale of Venezuelan oil, which the Maduro regime used to supply oil to Cuba and other states now deemed "hostile" by the EO, including China, Russia and Iran. Following the capture of Maduro, President Trump stated publicly that the operations in Venezuela could lead to the "fall" of the Cuban regime given its reliance on subsidized oil supplied by Venezuela. The Cuba EO was announced within hours of a new Treasury Department Office of Foreign Assets Control (OFAC) general license authorizing the limited sale of Venezuelan oil, which was issued after Venezuelan lawmakers approved sweeping reforms of Venezuela's laws to increase autonomy for private companies.

Rubio Testifies on Venezuela Policy, Links Venezuela and Cuba, and Comments on Cuba "Regime Change"

On January 28, 2026, a day before President Trump's issuance of the EO, Secretary of State Marco Rubio testified before the U.S. Senate Committee on Foreign Relations on the administration's policy on Venezuela, where he acknowledged the administration's desire to see a regime change in Cuba, noting that regime change is a precondition to lifting the long-standing embargo on Cuba under the Helms-Burton Act, a 1996 law that codified U.S. sanctions.

Additional U.S. Initiatives to Limit Cuba's Revenue Sources and Increase Pressure for Democratic Change

It is anticipated that in the coming weeks and months, the Trump Administration and U.S. Congress will adopt further measures to increase economic and diplomatic pressure on Havana. On January 29, 2026, the same day the EO was issued, Rep. Carlos Giménez (R-Fla.) announced that he will formally request the president of Mexico to stop sending oil to the Cuban government and that President Trump suspend all commercial flights between the U.S. and Cuba, as well as restrict U.S.-origin money remittances sent to Cuba. The initiative was immediately supported by Reps. Mario Díaz-Balart (R-Fla.) and María Elvira Salazar (R-Fla.).

Rep. Giménez acknowledged that these measures may temporarily worsen conditions for the Cuban people; however, he emphasized that in his view, such actions are necessary to significantly increase pressure on the Cuban government and advance to a definitive transition toward democratic governance.

In parallel, local authorities in South Florida, led by the newly elected mayor of Hialeah, together with the Miami-Dade Tax Collector's Office and other local agencies, have implemented plans to intensify regulatory and compliance oversight of businesses operating within their jurisdictions that engage in transactions or services linked to Cuba. These efforts are expected to focus on licensing and adherence to applicable state and federal regulations, specifically sanctions and export control requirements.

This local scrutiny is impacting travel services providers, money remitters, parcels forwarding companies and exporters who conduct transactions with or related to Cuba. Although these businesses are authorized under OFAC and export regulations, neither OFAC nor the Bureau of Industry and Security issues a license in all cases. For example, travel services providers that operate under a general license pursuant to the Cuban Assets Control Regulations will not have any OFAC-issued document to show to the authorities conducting the review. Therefore, some may need a legal opinion and other business records to explain compliance with sanctions. Clients are advised to conduct a comprehensive review of their Cuba-related operations to ensure compliance with applicable U.S. sanctions, export controls and local regulatory requirements. Proactive compliance assessments, internal audits and updated policies may be critical to mitigating legal, financial and reputational risks in this evolving enforcement environment.

Next Steps

President Trump's EO requires that the Commerce Secretary, in consultation with the Secretary of State, identify the foreign countries that are supplying Cuba with oil. Once these countries are identified, the Commerce Secretary, in coordination with other agencies including the USTR, is expected to identify the countries and imported goods from those countries that will be subject to an additional ad valorem duty.

It is not clear whether the U.S. government will target all such countries or only those providing a certain volume and value of oil to Cuba. Though President Trump recently posted a message on social media stating that 25 percent tariffs will be imposed against all countries doing business with Iran, no action has been taken related to that statement. In contrast, it is significant that the president has issued an EO directing action by administrative agencies to implement a process that could lead to the tariff measures related to Cuba.

Given that Mexico now supplies more oil to Cuba than any other country, Holland & Knight also is monitoring the impact of this EO on the U.S.-Mexico trade relationship. Any additional U.S. tariffs on Mexican products imported into the U.S. could increase bilateral tensions in the lead up to the six-year review of the United States-Mexico-Canada Agreement (USMCA). Just last week, top U.S. and Mexican trade officials met in Washington, D.C., and agreed to a series of formal discussions as part of the USMCA review process. If the U.S. imposes Cuba-related tariffs on Mexican goods, it could create friction in the relationship, change the tenor of the USMCA negotiations and perhaps alter the cadence of planned bilateral meetings. In addition, Mexican payments to Cuba for Cuban medical missions – which the Trump Administration considers to be a form of human trafficking – are a significant source of revenue for the Cuban government. The U.S. may pressure Mexico to decrease or end these payments during future bilateral negotiations.

Footnote

1. See V.O.S. Selections v. Trump (Docket No. 25-250) and Learning Resources, Inc. v. Trump (Docket No. 24-1287).

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