This website uses cookies primarily for visitor analytics. Certain pages will ask you to fill in contact details to receive additional information. On these pages you have the option of having the site log your details for future visits. Indicating you want the site to remember your details will place a cookie on your device. To view our full cookie policy, please click here. You can also view it at any time by going to our Contact Us page.

The explosive consequences of South American populism

23 November 2012

Resource-rich South America should be reaping the full benefits of the high demand
for hydrocarbons around the globe. That several countries in the region are not is due
to a number of reasons, amongst the most important of which are politicians wedded to
populism and nationalism.

Argentina’s President Cristina Fernández de Kirchner is a case in point. Her nationalisation of the Argentine oil firm YPF in April this year, expropriating 51% of Repsol’s majority stake in the process, has seriously damaged the country’s ability to develop its massive shale gas reserves.

Repsol is demanding $10.5 billion for its confiscated assets and has said it is ready to take legal action against anyone who now invests in YPF.

One of the few supporters of the Argentine move is Venezuela’s President, Hugo Chavez, who warned Repsol to “think carefully” about taking action against Argentina. “They have a lot of investment here in Venezuela,” Chavez said in July.

Repsol was one of the few western oil companies willing to invest in Venezuela after its spate of oil sector nationalisations in 2007, a decision the Spanish group may well have come to regret.

In the November issue we look at some of the possible consequences for the Venezuelan oil and gas sector of Chavez’ recent re-election, particularly in the light of the catastrophic explosion and fire at the country’s Amuay refinery in August, attributed by many observers to a continuing failure to invest in maintenance by its nationalised owner, PdVSA.

A link to the article is available below.

More information...

Contact Details and Archive...

Print this page | E-mail this page