Vista reaps more from crude sales as Argentina frees oil markets

Argentine shale driller Vista Energy charged export prices for more than 40 percent of crude that it sold to domestic refiners in the second quarter — the clearest sign yet that the South American country’s moves to free up oil markets under President Javier Milei are gaining momentum.

The libertarian leader has vowed to end the meddling in crude prices of previous governments, a tactic that kept gasoline cheap but turned off international investors eyeing the heralded Vaca Muerta shale patch. Since Milei took power seven months ago, drillers and refiners have been negotiating a pathway to so-called export parity for crude, which means that oil producers like Vista can charge the same prices locally as overseas.

Taking into account all of its sales — both local and global — Vista charged export parity, or about US$77 a barrel, for 64 percent of its production, Chief Executive Officer Miguel Galuccio said Friday on an earnings call, up from 47 percent a year ago.

Efforts to reach international pricing have slowed in recent weeks as Milei tries to keep inflation in check. But late last month, lawmakers gave the idea the green light for the long term when they approved Milei’s sweeping reform package.

The measures include legal provisions that would ban the government from intervening in crude prices and severely limit its scope for blocking export cargoes.

“These are two very important principles. The spirit of them is good,” Galuccio said. “Of course, it’s going to be a matter of execution — how fast the principles can be transmitted into reality. The fine-printing of the regulation is key.”

Other call highlights:

– Galuccio said Vista’s production forecast for 2025 is “shy,” and that it will update investors as it targets the upper end of its guidance for 2024
– He said the company will “compete hard” against rival bids to acquire Exxon Mobil Corp.’s Argentine shale assets
– An extra fracking set will arrive some time in the fourth quarter. Vista will also swap one of its existing three drill rigs for a “state-of-the-art” rig from Houston in October
– The volume of crude that the company trucks to ports could more than double to 20,000 barrels a day in the fourth quarter, representing more than one quarter of output, as it waits for new pipeline capacity
– The new capacity would allow Vista to next year reduce — and eventually eliminate — the need for costly trucking services