The government analyzes the essence of deicing

An unexpected new event exploded in the hands of the government. The international price of oil rose 14.6% in one day and defeated the freezing of fuel prices that governs until the end of October in the domestic market.

The value of a barrel of Brent rose yesterday to $ 69.02. They are about 10.02 dollars above the average value paid in Argentina for what is called the "Creole barrel", which is quoted at 59 dollars. A difference of 16.98% in dollars.

At the cabinet meeting chaired yesterday by President Mauricio Macri, it was agreed to monitor prices until Friday. The Energy Secretary, Gustavo Lopetegui, will talk with producers and refiners. And at the weekend, a decision will be made.

"We have agreed to see the developments during this week and from there to see if you have to make a decision or badyze a different problem," said Transport Minister Guillermo Dietrich, at the time of the meeting. ;a press conference. Basically, you will evaluate deicing prices.

All this happened after Saudi Arabia, the world's largest producer, was forced to halt about half of its oil production capacity after coordinated drone attacks on its facilities.

Huge fires have destroyed part of the Hijra Khurais and Abqaiq oil complexes, the largest oil stabilization facilities in the world. The situation has put the global energy sector in suspense.

The barrel of Brent (benchmark for the Argentine market) rose 14.41% to 68.92 $ in London. The freezing of domestic prices, an electoral measure that Macri's leadership decided after losing in the primary elections, is on the verge of collapse. "There are two outings, no more," said a qualified official source, "de-icing or maintaining prices."

Alternatives

The first solution would involve a 20-25% increase in the price of fuel at the pump, an undesirable situation for a government weakened by the setbacks of the elections.

The second would require compensation of 58 billion pesos, or $ 1 billion. The national state fund does not have this money, as the International Monetary Fund requires the budget balance to be reached in December.

Dietrich acknowledged that this situation was "disruptive", that it was not in the plans of the government, which sought to maintain domestic prices until October 31, four days after the presidential elections.

According to the newspaper, Lopetegui warned Macri and the other cabinet members that he will talk to companies about the cost structure. Because he also does not want a romp at Vaca Muerta, one of Cambiemos's best-performing bets.

If gasoline increased by 25%, the liter would rise to $ 60

Deicing would have an impact on inflation.