Only 14 months ago Argentina’s YPF SA was a nightmare for investors caught out by a $6 billion distressed debt restructuring. Now, in a swift turnaround, the 100-year-old state-run oil company is producing the best fixed-income returns in all of emerging markets.
YPF has rewarded steely creditors with returns topping 20% this year on some of its notes. It emerged from the pandemic with a strong cash position after bondholders agreed to push back $630 million in debt payments, helping fund long-term investments in Vaca Muerta, the vast Patagonian shale patch. Repeated promises by executives to reverse a long decline in oil production have finally started to come true.