Due to a severe lack of gasoline in Argentina, the country has been forced to import fuel for the first time in three decades. Yesterday, YPF, the former state owned company now owned by Spanish company Repsol, announced that next week it will import the equivalent to 20% of their monthly production.
YPF claim that the situation has arisen due to a drop in production from other oil companies such as Shell and Esso. However, the other companies in the market were quick to rebuff this claim. Public Affairs Director of Esso, Thomas Hess said, “We are working at maximum capacity and so far this March sold 20% more gasoline and 4% more diesel than the previous year.” He commented in an interview with Radio El Mundo that there is “no reason for the shortage” and that the Esso refinery was operating at its “maximum capacity”.
Some claim that the situation has arisen due to an increased demand for gasoline during the summer months because Argentines are choosing not to travel abroad for their summer holidays. Other commentators believe that the shortage is a worrying sign of the state of the country’s energy sector.
Luciano Gremone, an expert on energy issues at consultancy Standard & Poor, told BBC El Mundo that, “This may be only an isolated situation, but it is a warning sign.” He explained that until now Argentina has had a surplus of the gasoline used by private cars. A lack of fuel has arisen because of the tight balance between supply and demand. He continued, “Whereas in the past five years oil production has fallen, the demand continues to grow.”
As the supply of gasoline drops, the cost of fuel increases. So far in 2010 there have been three gasoline price increases. It is estimated that gasoline has increased in price by 14% in the last 30 days and this trend could continue. The situation could also worsen as the Employers Federation of Independent Service Stations has threatened to call a strike.