US Court Overturns Landmark $16 Billion YPF Judgment Against Argentina
In a significant legal and financial victory for Buenos Aires, a New York appeals court struck down a $16.1 billion judgment against Argentina on Friday, reversing a lower court’s directive that would have forced the nation to compensate former shareholders of the state-run energy giant YPF.
The U.S. Court of Appeals for the Second Circuit overturned the 2023 ruling by U.S. District Judge Loretta Preska, which had ordered Argentina to pay massive damages to Petersen Energía and Petersen Energía Inversora. The plaintiffs had sought compensation following the 2012 expropriation of a controlling stake in YPF by the Argentine government—a move that fundamentally altered the nation’s energy landscape.
For Argentine President Javier Milei, who has made the stabilization of the nation’s economy and the privatization of state assets central pillars of his administration, the ruling is a massive political boon.
“It’s historic, unthinkable, the greatest judicial victory in national history,”
— Javier Milei, President of Argentina
Milei did not shy away from the opportunity to critique his predecessor, Cristina Fernández de Kirchner, whose administration oversaw the 2012 nationalization, which ultimately led to the legal entanglement in U.S. courts. Kirchner, currently under house arrest following a 2025 corruption conviction, has long been a lightning rod for Milei’s criticism of previous governing regimes. “Because I’m Milei, I’ll say it the Milei way,” the president wrote on social media, claiming his government has “cleaned up the mess” left by the former administration.
The legal battle, which has roots in the New York Stock Exchange listing of YPF, represented a critical hurdle for Argentina’s international financial standing. The ruling provides much-needed relief as the nation attempts to rebuild foreign reserves and attract long-term investment. The litigation had been bolstered by investors backed by Burford Capital; however, recent developments, including a discovery stay issued earlier this week, had already begun to shift momentum by blocking attempts to seize or investigate sensitive Argentine government assets.
Key facts concerning the case include:
- Judgment reversal: The Second Circuit overturned the 2023 decision that required compensation for the 2012 nationalization.
- Energy output: YPF has seen production at the Vaca Muerta shale gas fields climb to approximately 600,000 barrels per day, contributing to record profits of $5 billion in 2025.
- Legal pivot: The U.S. Department of Justice had previously sided with Argentina in the litigation, which had grown to over $18 billion including accumulated interest.
The 2012 nationalization, while controversial, allowed YPF to accelerate development in the Vaca Muerta field in Patagonia. Despite the legal volatility, YPF remains a cornerstone of the Argentine economy, responsible for 68% of the country’s, national oil output. As Argentina moves forward, this judicial win—coupled with restored institutional confidence—appears to be the pivot point Milei was seeking to solidify his economic agenda.
