Argentina in gas price freeze, IMF talks

YPF, Shell and Pan American Energy have entered into an agreement with Argentina’s Ministry of Energy and Mines to put a hold on gas prices for May and June, international media reported Wednesday.

According to the ministry’s statement, these companies would be compensated for any incurred related costs for a six-month period starting July 1.

The deal aims to stabilise consumer prices following disturbances in Argentina’s financial market over several weeks. Following the depreciation of the Argentine peso over the past five months, the country’s central bank last Friday raised the benchmark interest rate to 40%, the highest rate among the major global economies.

In the wake of the recent market turmoil, President Mauricio Macri yesterday announced that the Argentine government would enter talks with the IMF to establish a new line of credit, reported to be worth USD 30 billion, according to local media.

“This will allow us to strengthen our programme of growth and development, giving us greater support to face this new global scenario and avoid crises like the ones we have had in our history,” President Macri said in a televised address.

Argentina has had a tense relationship with the IMF since 2001, when the country defaulted on its debt. Many critics in Argentina hold the fund accountable for the ensuing 2001-2002 financial crisis.