Trump’s Cuba Tariffs Target Third Countries. Here’s What Trade Law Says.

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On January 30, 2026, President Trump signed an executive order that threatens to impose tariffs on any country that sells oil to Cuba. Not tariffs on Cuba itself—the island has faced a sweeping U.S. embargo for decades. Tariffs on third countries. On their companies. On all their exports to the United States, potentially, if even one of their oil firms keeps Cuban refineries running.

Effective immediately at 12:01 a.m. eastern standard time, it gives the Secretaries of Commerce and State the power to decide which countries are providing oil to Cuba and to impose additional tariffs on their imports as punishment. This represents tariffs on countries that do business with Cuba, not Cuba itself—using tariffs as a tool to punish countries for trading with Cuba.

It relies on a law called IEEPA that lets presidents act during emergencies, claiming Cuba is an unusual and serious threat to U.S. national security. The justification: Cuba’s alignment with Russia, China, Iran, Hamas, and Hezbollah, and its provision of safe haven for terrorist organizations.

The Legal Problem: IEEPA and Tariff Authority

IEEPA lets the President control economic activity during declared national emergencies. The law doesn’t mention tariffs at all.

The Trump administration is arguing that the authority to “regulate” transactions encompasses the authority to impose tariffs. No previous administration has made this claim successfully.

Should the Supreme Court strike down IEEPA tariffs, the Cuba order becomes legally vulnerable under the same reasoning. Trump could attempt alternative statutory authorities or could simply refuse to comply.

How Secondary Tariffs Work

Traditional secondary sanctions target banks. The Iran sanctions of 2012-2015 are the template: the U.S. prohibited foreign financial institutions from processing petroleum transactions involving Iran. Banks had to choose between access to the U.S. financial system and doing business with Iran. Most chose the U.S.

That approach worked because losing access to dollar clearing is catastrophic for any bank operating internationally.

Secondary tariffs are different. They don’t target specific banks or companies. They target entire countries. A Spanish oil company imports Venezuelan crude, and the U.S. could impose tariffs on all Spanish exports—automobiles, pharmaceuticals, wine, everything. The company’s decision affects the whole nation’s trade relationship.

Countries facing secondary tariffs have to develop ways to stop their own companies from buying oil from Cuba. They end up enforcing American foreign policy within their own borders.

Mexico’s Position

Cuba’s oil supply situation changed dramatically after Venezuelan shipments stopped. Mexico now provides approximately 44 percent of Cuba’s crude oil imports—roughly 12,284 barrels per day in 2025.

President Claudia Sheinbaum is managing multiple pressures simultaneously: renegotiating aspects of the U.S.-Mexico-Canada Agreement, defending against criticism of Mexico’s drug enforcement efforts, and maintaining humanitarian solidarity with Cuba.

Cuba’s crude oil reserves are estimated at only 15 to 20 days of supply. Cutting off Mexican shipments could trigger mass blackouts, economic collapse, and potentially mass migration toward Mexico.

The WTO and National Security Exception

World Trade Organization rules generally prohibit raising tariffs above negotiated levels and require treating imports from all countries equally under the Most Favored Nation principle. Trump typically defends tariffs on national security grounds by invoking a rule that lets countries protect essential security interests.

For decades, this exception was treated as something countries could decide on their own—each country could unilaterally determine what constituted a security threat without external review.

The Cuba tariffs face a credibility problem here. Countries providing oil to Cuba pose a national security threat, yet Trump hasn’t applied similar measures to numerous other countries with arguably greater security significance. The selectivity undermines the national security justification.

Enforcement of any WTO adverse ruling is nearly impossible. Trump has blocked the WTO’s appeals process by refusing to appoint judges. The U.S. can appeal any adverse panel ruling into a legal void from which no final determination will emerge. It did exactly this with steel and aluminum tariffs—multiple WTO panels ruled against them, yet the tariffs remain in place.

Even though the Cuba tariffs probably violate WTO rules, the practical enforcement mechanisms available to aggrieved countries are limited to non-existent.

The Helms-Burton Precedent

The U.S. has tried aggressive extraterritorial Cuba sanctions before. The international response was immediate and hostile.

Aggressive extraterritorial sanctions generate international resistance that undermines their effectiveness. Countries don’t passively accept American attempts to regulate their companies’ behavior abroad.

Implementation and Affected Countries

The order delegates power to the Secretaries of Commerce and State, leaving implementation questions unresolved. The Secretary of Commerce must determine which countries are providing oil to Cuba—a task requiring intelligence about supply chains companies deliberately hide. The Secretary of State must then determine whether and at what level to impose tariffs.

No guidance on tariff levels. No timeline. No mechanism for affected countries to challenge determinations or present evidence they’re not providing oil to Cuba. No public announcement before tariffs are imposed, no chance for companies to respond.

The Secretary of State can choose whether to impose tariffs, suggesting tariffs could be imposed selectively as diplomatic leverage rather than automatically based on objective criteria.

Spain faces potential exposure. Spain imported Venezuelan crude oil and in 2023 was among the world’s largest importers of Venezuelan petroleum. Spain continued importing after the April 2, 2025, effective date of the Venezuelan oil tariff order, and could face 25 percent tariffs on Spanish goods—affecting automobile manufacturers, agricultural exports, industrial equipment.

China, the largest importer of Venezuelan crude in 2023, could face similar tariffs. Though China already faces substantial U.S. tariffs under other authorities and the trade relationship is fundamentally adversarial, additional tariffs might not change Chinese behavior.

Supreme Court Implications

The central legal challenge stems from ongoing Supreme Court litigation over whether IEEPA authorizes tariffs at all.

If the Supreme Court rules IEEPA doesn’t authorize tariffs, the Cuba order becomes legally vulnerable under the same reasoning.

Importers currently paying tariffs under IEEPA authorities face significant uncertainty. If the tariffs are invalidated, importers could seek refunds through administrative processes or litigation, potentially recovering billions in duties already paid.

The Supreme Court’s decision will shape presidential trade authority for decades. It might articulate limiting principles restricting presidential authority to impose tariffs under any emergency authority, not merely IEEPA. Or it might carve out special space for trade-related emergency measures. The decision could affect the President’s authority under Section 232, Section 301, and other trade-related statutes, potentially requiring Congress to be more explicit about delegating tariff authority.

Constitutional Delegation of Tariff Power

The Constitution explicitly grants Congress the power to “lay and collect Taxes, Duties, Imposts and Excises.” Modern presidents assert broad tariff authority under various statutes delegating authority to the executive.

The non-delegation doctrine has rarely been enforced in modern times. But courts may be more willing to limit what the President can do in the trade context.

It might require Congress to be explicit about delegating tariff authority for the executive to exercise broad tariff powers. This would represent a significant constraint on presidential economic statecraft and could reshape how future administrations approach trade policy.

Expert Assessment

Trade law scholars and international relations experts have raised substantial questions about both the legal foundation and practical wisdom of the order. The novel use of tariffs as secondary sanctions hasn’t been tested in court. Some experts argue tariffs—historically a tool for protecting domestic industry and managing bilateral trade relationships—represent a qualitatively different exercise of presidential power than the regulation of financial transactions and property transfers contemplated by IEEPA.

The national security justification faces skepticism. While Cuba maintains relationships with Russia, China, Iran, and some non-state actors, claiming these relationships constitute an “unusual and extraordinary threat” to U.S. national security is contested. Cuba’s military capability and strategic reach have declined substantially since the Cold War’s end. Its economic and military power pose no direct military threat to the United States.

The justification appears to rest more on Cuba’s ideological alignment with American adversaries and its support for regional actors the U.S. opposes, rather than on a direct security threat. That’s a much broader conception of “national security” than IEEPA was designed to address.

Sanctions scholars raise concerns about effectiveness. Financial secondary sanctions work because banks have powerful incentives to comply—exclusion from the U.S. financial system is catastrophic. Tariff-based secondary sanctions depend on countries deciding to enforce American foreign policy preferences within their own borders by restricting their companies’ ability to purchase oil from particular sources.

This represents a more significant assertion of American sovereignty over foreign commerce than traditional financial sanctions. Some countries may resist by developing alternative financial mechanisms or by supporting companies’ engagement with prohibited oil sources despite the tariff risk.

Broader Precedent for Trade Policy

The Cuba tariff order sets a precedent for using tariffs as tools of secondary sanctions more broadly. If the approach succeeds legally and diplomatically, this administration or future ones could extend the model to other countries.

This could fundamentally reshape international trade. The global trading system could fragment into trading blocs based on whether countries agree with U.S. foreign policy rather than by commercial logic or what countries are naturally good at producing. Other major trading powers—China, the EU—might adopt similar mechanisms, using market access as leverage to enforce their own foreign policy preferences.

The result would be a world where trade relationships depend less on economic efficiency and more on political alignment. Where companies must deal with overlapping tariffs and punishments from multiple countries imposed by multiple major powers.

For smaller countries caught between major powers, the implications are particularly severe. They face pressure to align their economic policies with whichever major power has greater market access to offer, regardless of their own national interests or foreign policy preferences.

Humanitarian Consequences

Cuba already faces severe fuel shortages. Crude oil reserves are estimated at only 15 to 20 days of supply at current consumption levels. The cutting off of Venezuelan supplies and the threat of tariffs on countries supplying Cuban oil could exacerbate shortages, leading to increased blackouts, economic disruption, and potentially mass migration.

Cuba’s civilian population would bear the primary burden of fuel shortages—through blackouts affecting hospitals, water pumping stations, and food distribution; through economic contraction affecting employment and living standards; through the cascading effects of energy scarcity on every aspect of daily life.

Whether economic coercion of this scale serves legitimate national security objectives or instead constitutes economic warfare against a civilian population is a question that will drive policy debates in Congress and the courts in coming months.

What Happens Next

The order will trigger substantial diplomatic pressure from affected countries and international trade bodies. Mexico, Spain, and potentially other trading partners will lodge formal protests and seek negotiations. The EU may file a WTO complaint, particularly if tariffs affect significant European trade volumes. China will likely view the measure as consistent with efforts to use tariffs as coercive diplomatic tools and may respond through retaliatory measures or expanded support for countries seeking to escape American economic pressure.

The practical effectiveness in achieving the stated objective—cutting off Cuban oil supplies—remains doubtful. Cuba may source oil from countries with minimal U.S. trade relationships. It may develop alternative financing mechanisms allowing continued commerce despite tariff risks. The island has survived six decades of a U.S. embargo; it has developed considerable expertise in finding ways around sanctions.

The legal questions will play out in federal courts over coming months and years. Lower courts will likely see challenges from importers, affected countries, and potentially from members of Congress arguing the order exceeds presidential authority.

Countries facing tariff threats will make calculations about whether compliance or resistance better serves their interests. Some may comply, calculating that maintaining U.S. market access outweighs the cost of abandoning Cuban oil sales. Others may resist, particularly when they view the precedent of allowing the U.S. to dictate their companies’ commercial decisions as more threatening than the tariffs themselves.

This represents an ambitious expansion of presidential power and a novel application of tariff authority. Whether it survives legal challenge, achieves its policy objectives, or instead generates international resistance that undermines American economic influence remains to be seen. The answers will shape not only U.S.-Cuba relations, but the fundamental structure of international trade and the scope of presidential authority for years to come.

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