Narayan AmmachchiArgentina’s struggling economy is experiencing a resurgence, driven by a significant increase in oil production that is set to surpass Colombia’s output.
Over the past three years, crude oil production has surged by 50%, while natural gas production has increased by 27%, according to U.S. federal government data.
This remarkable transformation has shifted Argentina from a net oil importer to a growing oil exporter, providing a crucial boost to its ailing finances.
At the core of this economic boom is the Vaca Muerta shale formation in Neuquén province. The U.S. Energy Information Administration (EIA) estimates Vaca Muerta holds 308 trillion cubic feet of shale gas and 16 billion barrels of shale oil. In the third quarter of 2024 alone, the formation produced an impressive 400,000 barrels per day.
Argentina’s oil exports are projected to reach nearly $5 billion this year, up from $3.7 billion in 2023. The majority of these exports are destined for the United States, with Brazil and Chile also being significant buyers.
The positive impact extends beyond the oil sector. The Argentine peso, long under pressure, is showing signs of stabilization. The previously widening black-market gap with the official exchange rate is now narrowing, driven by this energy-powered economic recovery.
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