Abstract

The Argentine oil sector has been moving strongly toward complete deregulation since 1989. Price controls on byproducts has been lifted, old petroleum contracts became into concessions, and the state oil company, YPF, is under process of privatization.

In this context. the international companies scouting for opportunities can find an important menu of potential investments.

But there remain some problems connected with this deregulation, too. The lack of a reference crude and product market price is one of them.

This paper focuses how to overcome this trouble with the establishment of an institutional market for crude and products, not only for Argentina but also, for the entire Southern Cone Region (Argentina, Bolivia, Brazil, Chile. Paraguay and Uruguay). inquiring into-the. benefits of its creation.

Those countries should follow Argentine steps in deregulation (more probably sooner than later). All of them, except Bolivia and Chile, have signed in 1990 the "Mercosur" treaty, which favores this type of enterprises.

Furthermore, it will be analyzed the incidence of this market in the oil trade, intraregional, or between the Southern Cone and the rest of the world.

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