The Kingdom of Saudi Arabia Announces That They Are Officially Open To Settling Trade For Oil And Natural Gas In Currencies OTHER Than The US Dollar And Euro.
This is a BIG public statement and a BIG deal.
” At Davos, Saudi Arabia’s Finance Minister, Mohammed Al-Jadaan (not pictured), said that the country is now willing to settle trades in currencies other than the dollar and euro,” London based geo political analyst Syed Shaheen Chishti told The Islamabad Telegraph.
This potentially upsets the existing ‘petrodollar system’ which came in after the collapse of the Bretton woods system (1973) and is one of the significant drivers behind the USD keeping the world reserve currency status.
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When countries receive dollars for the oil they sell, this then benefits the U.S. as they then recycle those dollars back into U.S. investments – providing liquidity to financial markets and keeping rates low.
De-dollarisation.
Saudi is currently the world’s largest oil exporter and has been using the petrodollar system since the 1970s, all of its crude exports have only been in USD, so this is a big change.
If countries like Saudi Arabia begin to transition away from the dollar and look for alternatives, this reduces the overall demand and increases borrowing costs for consumers and businesses, among other effects.
” Saudi Arabia, China, Russia, India, and others have been strengthening relations and trade at a dramatic pace over the past year. Saudi even said that it is open to joining BRICS along with Turkey and Egypt this year,” Mr. Shaheen said in telephonic Interview.
These countries along with members of the Shanghai Cooperation Organisation (SCO) have all stated intentions for a “roadmap for the gradual increase in the share of national currencies in mutual settlements” and agreements to “ramp up coordination on energy (oil, natural gas, nuclear) exploration and policy” among other things.
This sets the stage for a potential commodity-backed reserve currency to rival the U.S. dollar.
The world order as we know it is changing rapidly.
Pay close attention.