(Newser)
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The government of Argentina, claiming that a rise in oil imports is making the country "unviable," is taking control of the country's main oil producer. President Cristina Fernandez de Kirchner has announced plans to nationalize YPF, and is sending a bill to the country's senate allowing the government to expropriate 51% of its shares, reports the BBC. Spain's Repsol owns a majority of YPF, and Argentina's move is expected to escalate a dispute with the Spanish government, which has promised to take "clear and forceful measures."
Kirchner—who has already re-nationalized the country's main airline—says the company's "predatory attitude" made the move necessary. But analysts predict the takeover will backfire, by giving Argentina a bad image internationally and scaring off investors, including those who would have enabled YPF to exploit recently discovered shale oil fields. "This is going to make it very hard to attract the investment because you not only changed the rules of the game but took over the assets of the main company," an analyst at political risk research firm Eurasia Group tells Bloomberg.
