Overview
Since retaking office, President Trump has maximized economic and diplomatic pressure against Cuba by targeting key economic sectors through novel secondary tariffs and sanctions mechanisms. While the Trump Administration’s actions have materially impacted Cuba’s economy, they have yet to produce a negotiated outcome or the political changes sought by President Trump from the Cuban regime. This post describes the actions undertaken by the Trump Administration against Cuba during his second term in office and provides insights on the possible future trajectory of US restrictions against Cuba.
2025: Trump Reverses Biden-Era Policy Toward Cuba and Issues NSPM-5
On the first day of his second term, President Trump returned to a “maximum pressure” campaign against Cuba by revoking President Biden’s State Sponsors of Terrorism (SST) rescission and effectively restoring Cuba to the US list of SSTs. President Trump also reinstated the Cuba Restricted List (CRL) and restricted transactions involving Cuban military and intelligence entities.
On June 30, 2025, President Trump signed National Security Presidential Memorandum 5 (NSPM-5), which amended and reissued the document originally issued during his first term and later revoked by President Biden. NSPM-5 reaffirmed support for the US embargo, restricted US tourism in Cuba, expanded restrictions on Cuban hotels connected to the military, and condemned human rights violations, among other actions. By targeting hospitality, one of Cuba’s key economic sectors, the Trump administration set the stage for broader and more aggressive measures in 2026 aimed at other critical areas of the Cuban economy.
2026: Trump Expands Scope of Cuba Sanctions with New Executive Orders
Secondary Tariffs on Oil Shipments
President Trump issued Executive Order (EO) 14380 on January 29, 2026, which declared a national emergency with respect to Cuba and authorized the imposition of tariffs on third countries that directly or indirectly provide oil to Cuba. Up until that point, Venezuela served as Cuba’s primary source of oil. EO 14380, coupled with US pressure on Venezuela following the capture of President Maduro, dramatically reduced oil shipments to Cuba and resulted in significant energy shortages and widespread blackouts across the island. A Supreme Court decision on the use of tariffs under the International Emergency Economic Powers Act (“IEEPA”) later invalidated much of EO 14380. However, the administration maintained its pressure through a separate secondary sanctions EO, discussed below.
Secondary Sanctions Targeting the Cuban Regime and Non-US Parties
On May 1, 2026, President Trump issued EO 14404 and expanded the scope of existing Cuba-related sanctions. EO 14404 authorized the imposition of blocking sanctions on Cuban persons and significantly increased the risk for non-US persons dealing with Cuba by authorizing the imposition of secondary sanctions on a wide range of actors. In particular, blocking sanctions may be imposed on any person determined to have engaged in, or to be associated with, the following activities or statuses, among others:
- Operating or having operated in the energy, defense and related material, metals and mining, financial services, or security sectors of the Cuban economy, or any other sector as determined by the Secretary of the Treasury, in consultation with the Secretary of State;
- Being owned or controlled by, acting for or on behalf of, or otherwise being directed by, directly or indirectly, the Government of Cuba or any person whose property or interests in property are blocked pursuant to the EO;
- Owning or controlling, directly or indirectly, any person whose property or interests in property are blocked pursuant to the EO;
- Materially assisting, sponsoring, or providing financial, material, or technological support to, or goods or services for or in support of, the Government of Cuba or any blocked person;
- Being or having been a leader, official, senior executive officer, or member of the board of directors of the Government of Cuba or of an entity whose property or interests in property are blocked;
- Being an adult family member of a person designated pursuant to the EO;
- Being a political subdivision, agency, or instrumentality of the Government of Cuba;
- Being responsible for, complicit in, or having directly or indirectly engaged in or attempted to engage in serious human rights abuses in Cuba; or
- Being responsible for, complicit in, or having directly or indirectly engaged in or attempted to engage in corruption related to Cuba, including corruption involving the Government of Cuba or a current or former Cuban official, such as the misappropriation of public assets, expropriation of private assets for personal gain or political purposes, or bribery.
Unlike certain other comprehensive US sanctions regimes, the Cuba sanctions program has not traditionally had a significant secondary sanctions component to it. Therefore, the issuance of EO 14404 marks a critical expansion of US sanctions against the country and changes the risk profile for persons dealing with Cuba, particularly non-US persons acting outside the United States who may have previously been outside of OFAC’s primary sanctions jurisdiction.
Correspondent and Payable Through Account Sanctions on Foreign Financial Institutions
Section 4 of EO 14404 authorized the Secretary of the Treasury, in consultation with the Secretary of State, to impose prohibitions on opening or maintaining correspondent accounts or payable-through accounts in the United States and/or blocking sanctions on foreign financial institutions (FFIs), upon determining that the FFI has conducted or facilitated any significant transaction or transactions for or on behalf of any person designated pursuant to the EO. These provisions are closely analogous in structure and effect to the FFI secondary sanctions authorized under EO 14114 as part of the Russian Harmful Foreign Activities Sanctions. In response, on June 3, 2026, Cuba’s Central Bank announced that it was suspending Visa and Mastercard transactions after the foreign bank in charge of processing such transactions severed ties with a Cuban financial entity.
Additional Designations
On May 7, 2026, the US Department of State issued a press release announcing the designation of two Cuban entities and one Cuban national with alleged ties to the island’s military regime as Specially Designated Nationals (SDNs). Subsequently, on June 4, OFAC updated the SDN List and added five entities and five individuals linked to the Cuban regime. Most recently, on June 11, the US Department of State designated Cuba’s state-owned oil and gas company, Union Cuba-Petróleo (CUPET).
OFAC also issued FAQ 1258 to clarify the sanctions risk and exposure of non-US parties dealing with Cuban entities and individuals designated under EO 14404. In the FAQ, OFAC warns, “Non-U.S. persons, including foreign financial institutions, are exposed to sanctions risk for engaging in transactions with persons designated under E.O. 14404.” OFAC also noted that, as with all SDN designations, the restrictions extend to any entity in which one or more blocked person holds a 50 percent or greater interest, individually or in the aggregate, and stated that many entities on the Cuba Restricted List might be blocked for this reason.
Outlook and Compliance Considerations
EO 14404 is likely to continue to have numerous important consequences. First, it suggests the potential for the issuance of additional blocking sanctions in the future on a wide range of actors in Cuba. While Cuba remains subject to a comprehensive US embargo, historically, it has not been as frequent a target for new SDN designations as compared to other jurisdictions (although some targeted SDN designations have been used in the past). The issuance of the new EO, however, suggests that practice could change going forward with more frequent SDN listings.
Second, the EO significantly increases the secondary sanctions risks for non-US persons and financial institutions doing business in the enumerated sectors of Cuba’s economy or with designated persons. As noted above, historically, the Cuba sanctions program has not had significant secondary sanctions components, which are often associated with other comprehensive US sanctions programs (e.g., Iran). The rollout of the EO, however, considerably changes that landscape and raises the secondary sanctions risks materially for non-US persons doing business in Cuba.
The ultimate impact of the EO will depend, in significant part, on how aggressively it is implemented, as secondary sanctions are discretionary in nature, meaning that the Trump Administration has wide latitude to decide when, and under what circumstances, to wield this powerful tool.
For further information, please contact a member of our Economic Sanctions team.
