Economic woes in Cuba, which produces about 5% of the world’s nickel, could trigger a runup in nickel prices, industry analysts say. The price of nickel, currently about US$3.70 per lb., could reach US$5-6 per lb. if the flow of subsidized Soviet oil, which Cuba relies on as a major energy source, declines any further. Already this year, the amount of Soviet oil reaching Cuba has decreased by 15-25%.
Other sources say that Cuba will fall short by 7,000 tonnes on its contract to supply the Soviets with 17,000 tonnes of nickel in 1990.
“I am surprised that people aren’t focusing more on Cuba,” said Inco (TSE) Chairman Donald Phillips. “The high cost of oil is crimping their production.”
Last summer, Cuba shut one of its three production plants, the Che Guevara factory, because of rising oil prices coupled with an oil shortage.
Cuba is expected to produce 40,000-42,000 tonnes of nickel in 1990, down from 46,509 tonnes in 1989.
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