Monday, August 29, 2011

Natural gas flow causing problems in Argentina

For the past several winters, Argentina's government has rationed natural gas to manufacturers of cooking oil, auto-parts, and cement in the north of the country.

The measure is meant to keep gas flowing to households during particularly cold stretches of the winter. 'Price trajectory' is a delicate way of saying that prices must rise for households in the densely populated capital region of Beunos Aries.

Gas bills have been heavily subsidized there since the economic crisis ten years ago. Upper-income households pay as little as $15 a month for heat in the winter. With presidential elections coming later this year, that is unlikely to change soon. The government is insisting that new demand from previously unconnected households is causing the energy crunch.

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