Argentina: provinces threaten to cut gas supply – 02/24/2024 – Market

Argentina’s main oil and gas producing provinces threaten to cut off supplies to the rest of the country within days due to a dispute over federal resources with the country’s president, Javier Milei, whose severe fiscal adjustments are impacting basic spending by local governments. .

“Next Wednesday, not a drop of oil will come out if they don’t respect, once and for all, the provinces and don’t remove their foot from above”, declared this Saturday (24) Ignacio Torres, governor of Chubut (south) , on channel C5N.

Torres and his colleagues from the southern region of Patagonia (Tierra del Fuego, Santa Cruz, Río Negro, La Pampa and Neuquén) announced on Friday (23) that, “if the Ministry of Economy does not deliver Chubut’s resources, then Chubut will not deliver its oil and gas”, referring to the unilateral collection of a debt that Milei ordered to this province.

In a series of messages on the social network (R$80.2 million) in monthly transfers of federal funds to the district.

Argentina exports oil (39th in the world) and gas (20th in the world) and imports refined fuel to meet domestic consumption.

In 2022, the energy balance recorded a deficit of 12 billion dollars (R$59.8 billion), but the government estimates a surplus of 3.3 billion (R$16.4 billion) for 2024, due to the expansion of the field unconventional view of ‘Vaca Muerta’, in western Patagonia.

Chubut, the second largest oil and gas producing province after Neuquén, also received the support of nine provinces administered by center-right allies, whose deputies this month thwarted the approval of the “bus law”, which the president had hoped to adopt hundreds of tax cuts and ultraliberal reforms.

“Nacho and his accomplices”, wrote Milei in .

In the early hours of the morning, on a flight to Washington to participate this Saturday in the Conservative Political Action Conference (CPAC), in which former American president Donald Trump will also participate, the president made more than 300 references to the conflict on the X network.

“Don’t worry, Nachito, we’ll settle it in court,” Milei posted.

“I hope there is a channel for dialogue, the problem is that you don’t know who to talk to”, replied Torres hours later.

The Presidency’s Office issued a statement reiterating that “in no way will the Executive Branch contribute to financing the waste of provinces that refuse to reduce unnecessary spending and eliminate expendable political positions.”

The Minister of Economy, Luis Caputo, argued in ten other provinces that also owe money to the federal government.

“Not complying with the agreements between the nation and the provinces does not affect the governors, but rather the 50 million Argentines who live in the country’s 24 jurisdictions”, stated the non-Patagonian governors who supported Chubut’s ultimatum, qualified by the president’s office as a “Chavista threat”.