In the midst of the worst gasoline shortage in years, which has left many filling stations empty and long lineups at the pumps that are still in operation, Argentine drivers faced a daunting task on Monday: finding sparse supplies of gasoline to fill their tanks.
The South American nation has been experiencing gasoline and diesel shortages since late last week due to internal refining issues and delayed imports due to a lack of dollars.
Ahead of a runoff for the presidency in the second round next month between radical libertarian Javier Milei and the front-runner Sergio Massa of the ruling Peronist coalition, this has infuriated the government.
Raul Paretto, a 38-year-old driver for Cabify, said, “The truth is that I work with the car and it’s like looking for water in the desert.” “It is distressing because you don’t know on a day-to-day basis what can happen; we are living one day at a time.”
Empty gas stations with signs that read “no more petrol” are found all around the capital, Buenos Aires. Some locations experienced lengthy lines, and sales were restricted. Still, there were some indications that things were beginning to get better.
Self-employed worker Leonardo Villa said, “Today they sold me only super, though there was no premium,” while holding his car. “However, none existed yesterday and none the day before. I could at least fill up today.”
Farmers in Argentina reported that the lack of diesel was beginning to improve, which was good news since late season corn and soy are the nation’s two main cash crops.
“There is a little more supply, but it is not completely normalized,” Argentine Rural Confederations (CRA) head Jorge Chemes told.
Halting Export :
Oil executives pointed to the country’s limited foreign currency reserves, which have delayed imports, and the scheduled stops at local refineries, which supply 80% of the domestic market.
“The issue is not a scarcity of crude oil; rather, it’s a processing capacity issue with the refineries in Argentina,” stated an industry insider, who wished to remain anonymous due to lack of authorization to address the press.
In addition, the central bank lacks the dollars necessary to pay for imports. Furthermore, the refining companies lose money when they sell at the pump for less than what they pay for them, even when they do import, the source claimed.
In an attempt to rein in the country’s nearly 140% inflation, the Argentinean government set the local price of oil at $56 per barrel, much less than the international price of about $86. This distorts the financial picture for businesses that import goods from abroad.
Over the weekend, Economy Minister Massa threatened to stop exports of crude oil from the massive Vaca Muerta shale formation unless the domestic supply crisis was resolved by Tuesday.
“I am going to defend the internal supply, I am going to defend the consumption of Argentines,” he stated.
The biggest refiners and fuel producers in Argentina said in a joint statement on Monday that they had submitted a plan to the government that would increase stocks and restore full supply to gas stations.
“We will use all methods possible to accelerate the unloading of ships with imported fuel, which, like every year, supplements local production,” they stated.
Local unions supported Massa’s stance and declared that they would go on strike on Wednesday if the domestic issue wasn’t resolved. They said the oil companies were acting “opportunistic and petty” and that crude production was at a record high.
Reference :
Raszewski, E. (2023, October 31). Argentina drivers hunt for fuel “like water in the desert” amid shortage. Reuters. https://www.reuters.com/world/americas/argentina-fuel-pump-crisis-deepens-government-threatens-export-halt-2023-10-30/