Argentina concluded 2024 with its largest energy trade surplus in nearly two decades, according to data released by the nation’s energy secretariat on Tuesday. The country exported around $9.68 billion worth of fuel and energy while importing roughly $4.01 billion, creating a $5.67 billion surplus. This news marks a significant win for President Javier Milei, a far-right libertarian who has pledged to reinvigorate the country’s ailing economy through expanded oil and gas exports.
Record Surplus and Key Destinations
The energy secretariat’s figures revealed that Chile was the primary destination for Argentina’s energy exports, continuing the trend of strong cross-border trade between the two South American neighbors. A portion of these exports likely included natural gas shipments—transported through pipelines connecting the two countries—and refined petroleum products. The record surplus forms part of Argentina’s overall annual trade performance, one that the government hopes can help offset other economic challenges, including high inflation rates and low foreign-currency reserves.
Vaca Muerta: Argentina’s Shale Crown Jewel
Central to President Milei’s plan is the continued development of the Vaca Muerta shale formation, one of the world’s largest shale oil and shale gas reserves. Located primarily in the Neuquén Province in western Argentina, Vaca Muerta began drawing significant attention from multinational energy companies in the early 2010s. Its reservoir characteristics compare favorably with well-known U.S. shale plays, offering Argentina a chance to become a major global player in natural gas and oil exports.
Milei has positioned Vaca Muerta as the linchpin of his economic strategy, which also includes cutting back public spending and reducing the government’s role in business. If production continues to ramp up, he believes Argentina can generate enough surplus energy to export at scale, thereby replenishing government coffers, stabilizing the currency, and helping to curb runaway inflation.
Note: Data is barrels per day
* Source: Aleph Energy
Boosting LNG Exports and Investment
In tandem with the surplus announcement, state-run energy firm YPF revealed a partnership with three Indian companies for potential future exports of up to 10 million metric tons of liquefied natural gas (LNG) per year. LNG exports require significant infrastructure—liquefaction plants, specialized shipping terminals, and maritime fleets—but can unlock far-reaching markets beyond neighboring countries. Argentina’s growing focus on LNG is part of a broader effort to diversify export destinations and bring in foreign investment.
Such projects hinge on both domestic and external financing. In recent years, YPF and international partners have sunk billions of dollars into Vaca Muerta to develop drilling rigs, refineries, pipelines, and other production facilities. The Argentine government has also pushed infrastructure initiatives like the Néstor Kirchner Gas Pipeline, aimed at increasing the flow of natural gas from Vaca Muerta to major demand centers.
Note: Data is in thousands of cubic meters of gas production per day
* Source: Aleph Energy
Milei’s Bet on Economic Revival
President Milei took office with an ambitious promise to overhaul Argentina’s debt-laden economy, which has been plagued by one of the highest inflation rates in the world. His platform included liberalizing energy and agricultural exports, reining in public spending, and adopting market-oriented reforms. The massive $5.67 billion energy trade surplus bolsters his argument that Argentina can leverage its abundant natural resources—especially oil and gas—to drive a broader economic recovery.
However, challenges remain. Argentina’s currency struggles, periodic capital controls, and shifting regulatory environment could complicate efforts to lure foreign capital. Additionally, while the export boom brings in dollars, domestic energy prices and supply concerns must be balanced carefully—particularly for a population grappling with inflation and economic hardship.
Looking Ahead
For Argentina, the recent energy trade surplus is a welcome sign that its massive shale reserves can help reshape the national economic narrative. If YPF’s LNG plans materialize and exports to countries like Chile, India, and others continue to grow, Argentina could solidify its status as a major player in global energy markets. For President Milei, that means fresh momentum in his quest to stabilize the economy and fulfill his campaign promise of steering Argentina back to growth through resource-led development.
Still, the path is far from guaranteed. Global energy prices, fluctuations in demand, and domestic political opposition all pose risks to Milei’s grand vision. Even so, the record surplus underscores a critical truth: with the right policies, infrastructure, and partnerships, Argentina’s shale revolution could prove transformative for a country eager to leave its economic woes behind.
