MPs back energy firm takeover

The 207-32 vote lent strong support to President Cristina Fernandez's decision two weeks ago to take over Repsol's £6.5bn stake in oil firm YPF without paying a single centavo in advance.

Officials had worded the measure so it could be used to target any energy company operating in Argentina. It says that energy self-sufficiency is a national priority that private firms must back as well.

Since the government has kept energy prices far below the global market rate for nearly a decade, this means companies must sell energy extracted in Argentina to Argentinians first, even if it means missing out on exports that could bring fatter profits.

"This decision is going to require all Argentinians, and especially those who have institutional responsibilities, whether in the government or opposition, to face the challenge of building a YPF that is modern, competitive and aligned with the interests of the country," Ms Fernandez said.

Spain and the European Union have threatened to retaliate for the so-far uncompensated takeover from Spain's biggest company. Ratings agency Moody's increased its risk estimate for working in Argentina.

But the takeover is hugely popular at home, where it was praised even by opposition MPs for taking Argentina's future into its own hands.

The government previously took over airline Aerolineas Argentinas, the private pension system in 2008 and a privatised water system in 2006.

Only a few MPs were worried about the renationalisation.

Buenos Aires Mayor Mauricio Macri, leader of the PRO party, told reporters that it "will turn away the investments that bring jobs."

So far Spain's only retaliatory move has been to cut biodiesel imports from Argentina. Ms Fernandez scoffed at that, saying Spain is free to buy more expensive soy wherever it wishes.

Spanish Deputy Prime Minister Soraya Saenz de Santamaria said political and diplomatic retaliatory measures were also being considered.

Repsol refused to comment.