Meanwhile, Castro had begun talking with the Soviet Union in an effort to expand the market for Cuban sugar, thus reducing Cuba's dependency on one big customer. In 1960 the Soviets eagerly agreed to take large quantities of sugar in exchange for Soviet crude oil. The deal was a good one for Castro, since Cuba produced only about 10 percent of its petroleum needs. But it set off a chain of events that eventually restricted Cuban trade tremendously, a restriction from which it never recovered.

Most of the island's oil refineries were owned by American petroleum companies. At the strong urging of the U.S. government, which feared having a Socialist regime so close to home, they refused to refine the Soviet crude oil when it arrived. The refusal left Castro with little choice but to nationalize the refineries. In retaliation, in...