Argentina and Britain went to war over the islands in 1982, but the potential presence of up to 60 billion barrels of oil in nearby waters has reignited the sovereignty row.

Britain says it is acting according to international law in drilling for oil in waters off the islands, which it has held – setting aside the 1982 invasion – since 1833.

"Some predications are that there is a lot of oil in the seas around the Falklands," says Daniel Litvin, an energy expert at the Chatham House foreign affairs think tank. "Plus the fact that the oil price is relatively high, at around $75 (55.37 euros) a barrel, means I think that Argentina is very keen that it doesn't lose out if lots of oil is discovered."

Argentina submitted a claim to the United Nations last year for a vast expanse of ocean, and intends to raise the issue again this week. The claim includes the UK-governed Falkland Islands, which Argentina calls the Islas Malvinas.

It is also receiving regional support. At a summit in Mexico, Latin American and Caribbean leaders on Tuesday backed up Argentina's claims to the Falklands, calling for fresh talks on the sovereignty of the islands.

Venezuelan President Hugo Chavez, through a translator, spoke on Venezuelan television directly to Britain's Queen Elizabeth.

"Queen of England, I'm talking to you," he said. "Queen of England, the empires are over. Do you not realize? Give the Falklands back to the Argentine people, Queen of England."

British 'pride'

Argentina invaded the islands in the South Atlantic in 1982, leading to a conflict that ended with UK forces re-taking control.

Argentina has ruled out military action this time around, but is trying to ramp up pressure on Britain to enter negotiations over sovereignty. Daniel Litvin says that is unlikely.

"Certainly it has been in Britain's interests to not engage in that sort of international dialogue because Britain fought a war to retain sovereignty over the Falklands, and at least by many people in Britain that was seen as a national victory," he says.

"It became for some people a source of pride in Britain, and I think there is a sort of reluctance partly for that reason by Britain to engage in anything that might weaken Britain's control over the Falklands."

Buenos Aires has already imposed shipping restrictions around the islands. But British Defense Secretary Bob Ainsworth says Argentina has been made aware that the UK would take "whatever steps necessary" to protect the Falklands.

Doubts still remain as to whether there are any huge deposits of oil around the islands. But if predictions of oil are confirmed, many analysts believe this dispute could move to another level.


Author: Olly Barratt / dfm
Editor: Andreas Illmer