Fearing a trade war, a Spanish oil executive is asking Madrid to take a cautious approach to how it responds to Argentina's seizure of two subsidiaries of a Spanish oil major.
Gas Natural SDG SA (GAS) Chairman Salvador Gabarro said that the Spanish government's response should be measured and show an intelligent degree of force that helps Repsol, Gabarro said Thursday in Barcelona. It's absolutely necessary that governments support companies and I understand that's what this government will do, Bloomberg reported.
On Monday, the Argentinian government seized a majority of the shares of YPF, Argentina's largest oil company, that until this week was owned by the Spanish firm Repsol. Argentina is in the midst of an energy rush in certain Patagonian states, and President Cristina Fernandez's government has accused the Spanish firm of not doing enough to explore for and develop Argentine oil.
The move is designed, in the government's description, to give Argentina control over its own resources.
The Spanish government had warned any seizures would be considered an act of aggression, but on Thursday Fernandez's government ordered another such act with the takeover of another Repsol-owned company, YPF Gas, a public utility. YPF Gas is a separate company, not tied to the YPF oil group that was seized earlier in the week, Agence France-Presse reported.
On a visit to Colombia, Spanish Prime Minister Mariano Rajoy called the second seizure an injustice but did not elaborate further, AFP reported.
The Spanish government is still discussing ways to respond to the seizures, but there are fears the on-going disagreement between the two capitals will chill investor's desire to work in Argentina.
The United States, the International Monetary Fund, and the European Union have each denounced Argentina's move, AFP reported.