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In a surprise development, Argentina’s unconventional oil production hit a new all-time high for September 2025. This occurred despite overall monthly production falling marginally when compared to the prior period and shale gas output plummeting to a multi-month low. It is the prolific Vaca Muerta shale that is driving Argentina’s rapidly rising oil and natural gas production. The 8.6-million-acre formation is proving to be a boon to Buenos Aires and could very well be the long-awaited silver bullet needed to fix Argentina’s economy. Data from Argentina’s Ministry of Economy shows an average daily production of 833,874 barrels of crude oil for September 2025. This is 2% higher than August 2025 and a notable 14% greater than the same month a year earlier. This is a new average daily production record for Argentina, although total September 2025 output of 25 million barrels was 1% less than the 25.3 million barrels lifted a month prior. Source: Argentina Ministry of Economy. Soaring shale oil production is responsible for the impressive increase in Argentina’s petroleum output with conventional petroleum production growth once again remaining flat. For September 2025, Argentina’s unconventional oil output surged a whopping 30% higher year on year to an average of 550,881 barrels per day, which is a new record high. As a result, shale oil is responsible for 66% of Argentina’s total petroleum production, which is the highest level ever recorded. Those numbers confirm Argentina’s place as South America’s fourth-largest oil producer behind Brazil, Venezuela, and Guyana. Indeed, at the end of 2024. Argentina overtook Colombia to become the continent’s third-largest oil producer, but was displaced by Guyana after Exxon’s Yellowtail project came online in August 2025, lifting the former British colony’s production to 850,000 barrels per day. This is driving higher hydrocarbon exports, an improved balance of trade, and greater fiscal income for the federal government in Buenos Aires, thereby strengthening Argentina’s crisis-prone economy. On a disappointing note, Argentina’s September 2025 natural gas production plummeted. Ministry of Economy data shows the country pumped 4.9 billion cubic feet of natural gas for the month, which was 6% less than a month prior and 12% lower year on year. This was primarily driven by a sharp decline in shale gas production, which for September 2025 was 3.1 billion cubic feet per day, a 7.5% decrease month on month and a 15.6% drop compared to the same period a year earlier. Source: Argentina Ministry of Economy. The sharp decline in shale gas output was the result of wells being shuttered for regular maintenance. A lack of infrastructure, notably pipelines and storage facilities, is also weighing on hydrocarbon production in the Vaca Muerta, with fears emerging that production growth will stall because of those bottlenecks. If infrastructure shortages are overcome, Vaca Muerta’s hydrocarbon production will grow at a rapid clip, especially when the shale play’s enormous hydrocarbon potential is considered. The U.S. Energy Information Administration (EIA) estimates the Vaca Muerta contains 16 billion barrels of recoverable shale oil and 308 trillion cubic feet of recoverable natural gas. Those numbers make the geological formation one of the largest shale plays globally, containing the world’s fourth-largest shale oil and second-largest shale gas reserves. It is worth considering that nearly all of the 8.6-million-acre geological formations' shale oil and gas resources are untapped, with only around a tenth of the Vaca Muerta currently under development. This data underscores the tremendous potential that exists outside of the area under development. According to global consulting agency McKinsey and Company, the Vaca Muerta possesses characteristics that make it equal to or in some cases superior to U.S. shale plays. The formation’s thickness is superior to the Eagle Ford and Bakken while being equivalent quality-wise to the Permian Basin, which is pumping 6.6 million barrels per day, making it the United States’ largest oil-producing region. The Vaca Muerta shale has higher organic content than the Eagle Ford, whose reservoir pressure is comparable to the Permian Basin. Those attributes make exploiting the Vaca Muerta a lucrative activity. You see, wells drilled in the shale play enjoy high productivity rates, which in many cases are superior to wells in U.S. shale formations. As a result, drillers in the Vaca Muerta enjoy a low breakeven price. It is estimated that the geological formation breaks even at between $36 and $45 per barrel. This makes the Vaca Muerta in the current low-price environment, with the international Brent benchmark trading at around $63 per barrel, profitable to drill. This is significantly lower than Argentina’s conventional oilfields, where production breaks even at $55 to $75 per barrel. Earlier this year, the CEO of Argentina’s national oil company YPF, Horacio Marin, claimed the driller is profitable at $40 per barrel of oil. He further asserted that at $45 per barrel, YPF can profitably develop the entire Vaca Muerta. Analysts believe breakeven prices could be lower, with McKinsey estimating the technical breakeven price to be $36 per barrel. Those breakeven prices are particularly competitive compared to U.S. shale, where the average breakeven price is estimated to be around $70 per barrel. Indeed, U.S. shale oil breakeven costs could rise to $95 per barrel by the mid-2030s as inventories deplete and expenses soar. Breakeven prices in the Vaca Muerta will fall as the formation is developed and much-needed infrastructure comes online. The characteristics of the shale oil produced from the formation further enhance profitability. The crude oil pumped from the formation is especially light with a reported API gravity of 39 to 42 degrees. This petroleum is especially sweet, possessing a sulfur content of less than 0.5% and as low as 0.1%. Those attributes make it particularly attractive for refining into high-quality low-emission fuels at a low cost, which is especially important in a world where stricter emission standards are regularly being introduced. Impressively, the crude oil lifted in the Vaca Muerta has a low carbon footprint when compared to other types of petroleum. According to McKinsey, 15.8 kilograms of carbon dioxide are produced per barrel lifted in the shale formation. This is significantly less than other petroleum-producing operations globally, notably those where heavy crude oil is being lifted. It is well below the global average of 23 kilograms of carbon dioxide emitted per barrel of crude oil lifted. This enhances the attractiveness of the Vaca Muerta for foreign energy companies seeking exposure to one of the world's fastest-growing shale oil and gas plays. For these reasons, foreign energy investment in Argentina continues to expand at a solid clip. This was given a healthy boost by President Milei’s radical economic reforms, which have reduced various barriers to investment like heavy-handed capital controls and significantly reduced inflation. It is easy to see investment in the Vaca Muerta surging between now and 2030, with Argentina’s oil production forecast to top one million barrels per day by the end of the decade. 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