http://www.bbc.co.uk/news/world-europe-17739204
Demonstrators in Buenos Aires backed the nationalisation of YPF on Monday
YPF Repsol: Spain warns Argentina of strong response
Demonstrators in Buenos Aires backed the nationalisation of YPF on MondayThe Spanish government has warned it will defend its interests as a row with Argentina over the nationalisation of oil company YPF intensifies.
Promising a "clear and overwhelming" response, the government summoned the Argentine ambassador to Madrid to express its concern.
The majority stake in YPF is owned by Spanish oil firm Repsol.
Repsol shares fell by 8% in early trading in Madrid and the firm has vowed to demand compensation.
It said it would seek international arbitration over its 57% stake in YPF if necessary.
"These acts will not remain unpunished," Repsol executive chairman Antonio Brufau told reporters.
According to AFP news agency, Repsol will seek compensation of at least $10bn (£6.3bn; 7.7bn euros).
'Friendship' strainedArgentina's ambassador to Madrid, Carlo Antonio Bettini, was due to arrive at the foreign ministry at midday (10:00 GMT), the ministry told the BBC News website.
Earlier, Spanish Foreign Minister Jose Manuel Garcia-Margallo said the "climate of friendship" between the two countries had been broken.
The Spanish Prime Minister, Mariano Rajoy, is due to visit Mexico and Colombia, where he is expected to seek support for Madrid's position.
His Industry Minister, Jose Manuel Soria, said Spain would take "all measures it considers appropriate" to defend the interests of Repsol and Spanish businesses abroad.
The nationalisation was announced to applause on Monday at a meeting between Argentine President Cristina Fernandez de Kirchner, her cabinet and provincial governors.
Reading out a statement at the meeting, an official said YPF had been "declared a public utility and subject to expropriation of 51% of its assets".
Argentina wants to reduce its expensive energy imports from elsewhere, the BBC's Tom Burridge reports from Madrid.
Before rumours surfaced several weeks ago that Argentina might take YPF from Repsol, Spain and Argentina generally enjoyed good political ties, and important economic ones.
Spain does a significant amount of trade in the country, so there is likely to be an economic fallout to this dispute too, our correspondent says.
'Mistaken policy'Mr Brufau accused President Fernandez de Kirchner of resorting to nationalisation "as a way of hiding the economic and social crisis which Argentina is suffering".
Argentina's crisis, he argued, was rooted in "a mistaken energy policy".
He accused Argentina of running a campaign of "harassment" in recent weeks in order to push down the price of YPF shares and get a bargain price for the expropriation.
"It is not appropriate for a modern country, Argentina does not deserve this," he said.
Repsol's Argentine partner, the Eskenazi family's Grupo Petersen, has a 25.5% stake in YPF which will not be affected by the nationalisation.
However, Reuters notes that it is unclear how Petersen will be able to repay a $1.9bn loan provided by Repsol.
and.....
http://www.businessinsider.com/spain-withdraws-ambassador-to-argentina-after-ypf-nationalization-threat-2012-4
Yesterday we wrote about Argentina's threat to nationalize publicly listed energy company YPF, whose stock prompted fell 15%+ on the news before being halted in the afternoon.
YPF is owned in large part by Spanish firm Repsol, and so Spain is freaking out.
According to the FT, Spain has gone so far as to pull its ambassador to Argentina.
As FT notes, there were already expectations that Repsol would lose much of its stake, but the estimate was 57%, not 100%.
Following an emergency government meeting, Spain’s foreign minister José Manuel Garcia-Margallo said Madrid was considering measures against Argentina, which would be announced in the coming days.
“This has broken the cordial climate that existed between Spain and Argentina,” he said. “Spain had worked with Argentina during its hardest hours.”
and here are some hints.... http://www.guardian.co.uk/business/2012/apr/17/eurozone-crisis-japan-firewall-imf
Argentina's decision to nationalise YPF, majority owned by Spain's Repsol, last night is turning into a major political row.
Spanish industry minister Jose Manuel Soria pledged this morning to retaliate against Argentina, saying:
With this attitude, this hostility from the Argentine authorities, there will be consequences that we'll see over the next few days. They will be in the diplomatic field, the industrial field, and on energy.
EC president Jose Manuel Barroso also weighed in this morning, saying he was "seriously disappointed) by the move, while Repsol itself is demanding $18bn of compensation for its stake in YPF.
Although Spain isn't a member of the G20, the argument could overshadow the meeting of the world's 20 major economies in Washington later this week. It has certainly rattled in Repsol (shares down 6% right now). As Stuart Joyner of Investec commented:
The Argentine Tango is the consummate dance of love, but there was little affection for the country's largest foreign investor in Buenos Aires yesterday.
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