Smash 'n' grab raid condemns Argentina to pariah status YPF is Argentina's biggest oil company. But that doesn't mean Fernández can do what she likes with it - for the simple reason that its 57.4pc-owned by Spain's Repsol. In her crassly populist attempt to renationalise what she persists in seeing as Argentina's property, Fernández is doing much more than provoking a diplomatic row with Spain - historically one of the country's biggest allies. She is triggering the type of international incident that will condemn Argentina to pariah status, in the minds of investors, for years to come. Argentina has been frozen out of the capital markets since 2002 when it spectacularly defaulted on its debts. There's no hope of rehabilitation all the time Fernández is in charge. The seizure of YPF marks the biggest renationalisation of natural resources since Russia grabbed Yukos in the early 2000s and threw its boss Mikhail Khodorkovsky in jail. But, distasteful though that episode was, it was a Russian power grab, not involving expropriating the assets of a foreign company. Two questions need to be asked. Is Fernández indulging in simple resource nationalism? Or is this part of a wider attempt by Argentina to flex its muscles? Fernández is furious that energy-rich Argentina has to spend 7pc of its annual budget importing the stuff - but that is not Repsol's fault. It has invested heavily in Argentina - a third of its total capex budget last year - while YPF accounted for only a quarter of Repsol's operating income. Argentina reckons it has new fields containing up to 22bn barrels of shale oil and gas. But who does it expect to provide the $25bn a year required to develop them - if it turns away foreign investors? It can't afford it itself. In fact, Fernández's move on Repsol - coming so soon after Argentina threatened British and American banks with legal action over their involvement with Falklands oil and gas explorers - looks dangerously similar to the antics of another South American leader: Venezuela's Hugo Chavez. His threats to foreign companies have ensured no-one in their right mind invests in Venezuela. That is where Fernández's Argentina is currently heading. Wikileaks cables show that US Secretary of State Hillary Clinton was so disturbed by some of her behaviour that she requested a psychological profile. You can sort of see why.