U.S. appeals court overturns US$16 billion judgment over Argentina energy company nationalization

A worker fuels up a van at a YPF gas station in Buenos Aires, Argentina, July 14, 2025. (AP Photo/Rodrigo Abd, File)

BUENOS AIRES, Argentina — A New York appeals court on Friday struck down a US$16.1 billion judgment against Argentina, overturning a lower court’s order to compensate former shareholders of the nationalized energy giant YPF, a decision that was celebrated by Argentine President Javier Milei.

In the latest ruling in the long-running legal case reviewed by The Associated Press, the U.S. Court of Appeals for the Second Circuit overturned a 2023 judgment in which U.S. District Judge Loretta Preska ordered Argentina to compensate investors — Petersen Energía and Petersen Energía Inversora — for the seizure of a majority share in YPF Energy in 2012.

“Today is a day of celebration for the good Argentines,” said Milei in a national broadcast on Friday. “What seemed impossible, we made possible.”

The president also took aim at former left-wing leader Cristina Fernández de Kirchner, whose administration oversaw the nationalization of YPF.

“Because I’m Milei, I’ll say it the Milei way,” he wrote, adding that his government has “cleaned up the mess” left by the former leader.

Kirchner has been under house arrest since 2025, following a six-year prison sentence for corruption.

In June last year, Judge Preska ordered Argentina to transfer its 51 per cent controlling stake in YPF as a partial compensation to the plaintiffs. Two months later, the appeals court placed that order on hold.

Milei, who has struggled to rebuild depleted foreign reserves and has pledged to privatize state-owned companies, has frequently blamed his political opponents for the legal fallout from the YPF seizure.

The 2012 nationalization of Argentina’s largest energy company, further damaged Argentina’s international standing by reinforcing its history of abandoning its global financial obligations.

Plaintiffs were able to sue YPF in the U.S. because the company is listed on the New York Stock Exchange.

Since its nationalization, YPF has accelerated the development of Argentina’s vast shale gas reserves in the Vaca Muerta field in Patagonia. Crude production at Vaca Muerta has steadily climbed, reaching nearly 600,000 barrels per day in January, about 68 per cent of national output. In 2025, YPF reported a profit of US$5 billion, its highest level in the past 10 years.

Clara Preve, The Associated Press