YPF’s Stocks in Argentina: Sudden Surge
YPF’s stocks in Argentina experienced the most significant surge ever recorded following the election of the right-wing presidential candidate, Javier Milei.
Among Milei’s plans is the privatization of the state-owned oil and gas producer and the elimination of controls hindering the sector.
The American Depository Shares of the driller skyrocketed by up to 43%, the largest intraday move since they began trading in 1993. The Argentine government holds a majority stake in the company.
Javier Milei has promised a radical restructuring to fix decades of political mismanagement in the inflation-hit country. This includes the dollarization of the economy, the closure of the central bank, and the end of fuel price controls.
Meanwhile, YPF’s stocks in Argentina boosted the stock market, as the leading S&P Merval index of the Buenos Aires Stock Exchange gained a strong 17%, reaching 756,000 units at 1 pm.
The session was encouraged by price adjustments after the holiday inactivity, with energy sector companies leading the market trend. By the morning, the advance exceeded 20%.
These measures and others have kept YPF and the Vaca Muerta shale basin “in the background,” said Fernando Valle, a Bloomberg Intelligence oil analyst. Argentina’s shale region has significant untapped potential that has been constrained by bottlenecks.
In theory, Milei’s plans should improve YPF’s margins and attract foreign direct investment. “It’s a matter of whether he can achieve it,” said Valle.
YPF Stocks in Argentina Rise, and Other Related Stocks
The independent producer Vista Energy, a shale developer listed in Mexico, focusing on Vaca Muerta, also rose on Monday.
At the same time, Milei’s efforts in the oil sector could be derailed by the $16 billion Argentina had to pay in September for its controversial renationalization of YPF in 2012.
Litigation financier Burford Capital, supporting the entities, did not respond to a request for comments.
Meanwhile, President Luiz Inácio Lula da Silva chose to suspend relations between Brazil and Argentina until there is clarity about Javier Milei’s administration’s plan for dealing with its largest trading partner in South America, according to Brazilian government officials familiar with the strategy.
Also read: The Beer and Soft Drink Sector in Mexico: Significant Tax Contribution.
