Cold temperatures, the war in the Middle East, and a failed liquefied natural gas (LNG) tender threaten to drive up costs for Argentine industries and potentially leave them without natural gas as winter approaches.
The situation is a result of local law, which offers households and small businesses priority over industry in the event of a gas shortage. Large utility companies may even suspend service to industries in the event of peak demand from other sectors.
With this fall seeing lower-than-normal temperatures, the risk is that this trend will continue and demand from priority sectors will end up consuming the entire supply.
The most unexpected problem, however, was the failure of the tender issued by the Argentine government last month.
From an alternative that potentially promised greater efficiency and lower prices, the industrial sector suddenly found itself with the government once again in charge of supply — only at costs exponentially higher than those it had promised.
