Posted on 01/20/2023 3:49:57 AM PST by EBH
Saudi Arabia is opening its economic doors about trading in currencies other than the US dollar, Finance Minister Mohammed Al-Jadaan sounded off at the World Economic Forum in Davos, Switzerland.
“There are no issues with discussing how we settle our trade arrangements, whether it is in the US dollar, whether it is the euro, whether it is the Saudi riyal,” Al-Jadaan said in an interview with Bloomberg. “I don’t think we are waving away or ruling out any discussion that will help improve the trade around the world.”
(snip)
The term petrodollar refers to the US dollar’s position as the primary worldwide currency for international oil transactions. This status was established in the 1970s as part of a pact between the US and Saudi Arabia in which the US committed to provide Saudi Arabia with military protection in exchange for the Saudi government agreeing to price all of its oil exports in US dollars.
This arrangement has contributed to the US dollar’s status as the world’s reserve currency, as well as given the US enormous influence in the global oil market.
In one of his recent dispatches, Credit Suisse contributor Zoltan Pozsar noted that recent geopolitical moves–most especially by China through demanding renminbi settlement–have been contributing in the de-dollarization of global economy.
“The ‘new paradigm’, as I see it, comes with a theme of ’emancipation’,” Pozsar explained. “Both sanctioned and non-sanctioned members of OPEC, with Chinese capital, are going to adopt the ‘farm-to-table’ model in which they will not just sell oil but will also refine more of it and process more of it into high value-added petrochemical products.”
Simply put, the ‘oil for arms’ arrangement in the 1970s that helped the US dollar rise to the role of world currency has now been crowded out by the ‘oil for development’ proposal by China, setting the stage for the yuan’s improved status in the global stage. The latter’s strategy would probably be more effective as renminbi clients like Saudi Arabia have now empowered economies and want the world to recognize further emancipation.
The BRICS don't give a s--- about sustainable unicorn rainbows, ESG, carbon credits, et al.
The BRICS don't give a s--- about sustainable unicorn rainbows, ESG, carbon credits, et al.
Sure try Chinese Yen or Russian Rubbles then come back and tell us how that worked out.
“Sure try Chinese Yen or Russian Rubbles then come back and tell us how that worked out.”
Russia isn’t a big deal with Saudi Arabia, but the Chinese Yawn will be JUST FINE, as China needs the oil.
And one thing, for sure, China WILL NOT lecture MBS on so-called ‘human rights’.
If ever there were a government set on its own self-destruction, then the Joe Stolen/”Que mala” Harris regime certainly fits the description.
Fools racing about with spearpoints thrust against their own chests, on a broken and unlevel field, without any formation or discipline, often at cross purposes with themselves.
What could possibly go wrong?
And why should the US Navy protect Ruble or Yuan denominated tankers at sea from piracy? And why should maritime insurance companies write insurance policies on those vessels?
SWIFT fallout begins.
Who will guarantee safe passage of those tankers from the Persian Gulf to Shanghai?
The chinese navy has shown that it is more than willing to expand to protect its own container ships.
China is the biggest export partner with over 20% of exports.
China is also the biggest import partner. They produce what Saudi wants.
Why wouldn’t they trade in Yuan?
Well they don’t currently have a blue water capable Navy. Are they going to build one next week?
Can you tell me who will guarantee safe passage of container ships from China to Saudi and who will guarantee passage of oil tankers from Saudi to China?
A) Yes they already do. B) They are expanding rapidly. The Type-003 carrier is undergoing trials and a bigger Type-004 is already under construction.
The oil producers don't need an America that is anti-petroleum, and the WEFtards hate both America and oil.
Enjoy your bug meal and occasionally running EV (And remember - no trips farther than 15 minutes from home. Or else!)
No, they don't.
Yes they do.
China will work with the local countries to deter piracy, and it will deploy the Chinese navy to a limited extent.
Demented Joe is the cause of this dilema
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