Argentina’s decision to take control of Spanish firm Repsol’s shares in one of Argentina’s largest oil producing companies could have political ramifications.
There has already been anger from Madrid over the plan to nationalise Repsol’s stake in Argentine-firm YPF, and Spain’s Foreign Minister Jose Manuel Garcia-Margallo said measures against Argentina will be announced in the next few days.
Spanish Industry, Energy and Tourism Minister Jose Manuel Soria added: “Our government is going to act in a manner consistent with the attitude we’re faced with, due to the hostile activities of the Argentinian authorities. There will be consequences, in the diplomatic, commercial, industrial and energy fields.”
It was announced by President Cristina Fernandez that Repsol’s shares will be expropriated, resulting in the Spanish company losing its nearly 60 percent holding in YPF. Her government said the move was to help reduce expensive energy imports.
Repsol’s share price has fallen since the decision.
The company is valuing its stake in YPF at 18.3 billion dollars – close to 14 billion euros. Repsol is seeking compensation and even threatening legal action.