Argentina's oil boom lifts Neuquén as Buenos Aires sheds jobs

Argentina's inflation rate has fallen from near 300 percent to about 30 percent and the economy has probably grown for two years running, but the gains are landing in a few places. The Patagonian oil province of Neuquén is booming while the Buenos Aires area keeps shedding factory and retail jobs, the Buenos Aires Times reported ahead of next year's presidential election.

The Buenos Aires Times said 27 projects worth US$76bn have been approved under Milei's investment programme, with a further US$133bn of proposals under evaluation. Peter Thiel, the American investor, bought a US$12m house in Buenos Aires and a stake in Vista Energy, the country's largest private oil company. Continental Resources, owned by the Oklahoma oilman Harold Hamm, is bidding for fields in Vaca Muerta, the shale formation in Neuquén, and JPMorgan and Chevron are financing or drilling, the paper reported. The United States gave Milei's government a US$20bn lifeline last year.

Away from the oil patch the picture is different. More than 32,000 businesses have closed since Milei took office, according to the Buenos Aires Times, leaving the number of private-sector employers at its lowest since 2007. Argentina has lost more than 265,000 formal private-sector jobs, partly offset by informal work that pays less. Only four of the 23 provinces, plus Buenos Aires City, have added formal private-sector jobs; Neuquén is growing faster than anywhere else.

Poverty is at its lowest level in a decade and the major credit rating agencies have upgraded Argentina's sovereign debt, the paper reported. Approval for Milei's government stood at 39 percent in September, down from 43 percent at the start of the year, in a LatAm Pulse survey by AtlasIntel for Bloomberg News. Argentine sovereign bonds have been among the worst performers in emerging markets over the past two months.

Milei promised 5 percent growth for 2026 in last year's budget; the economy is on course for 1.5 percent, the Buenos Aires Times reported, and probably contracted between April and September, which academics call a technical recession.

Neuquén, with about 700,000 people, took in 21,000 new residents last year and the provincial government has begun building 160 classrooms. Paved roads, street lighting and public transport have not kept up. "When some people go on television and talk nonsense about the number of available jobs, they are not reflecting reality," Governor Rolando Figueroa said. "To get a job in Vaca Muerta, you have to train for at least a year."

In Buenos Aires, the FATE tyre plant closed in February after 80 years, putting nearly 1,000 people out of work. Alicia Arce, 63, whose cleaning supplies shop is a block away, estimated her sales are down 30 percent. Roberto Ambrosio, a former machine operator at the plant, said his income fell from 1.6 million pesos to about 300,000.

Milei said on August 20: "We're not in paradise, this isn't Switzerland, but we can't ignore the initial conditions. The photo is still horrible but the movie, it's the best movie in Argentina's history."

Diego Esquivel, 38, moved to Neuquén and tripled his salary managing housing for oil workers. He voted for Milei in 2023 and for his party in the 2025 midterms, and says he has not decided how he will vote next time.