The death of the dollar?
POSTED BY: SIGNYM
UPDATED: Sunday, August 23, 2026 15:35
VIEWED: 15891
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Better a late post than never, I suppose ...
In another sign of de-dollarization, Venezuela is no longer accepting dollars for oil. It's pricing its oil in yuan instead. This goes along with the Iran-Russia deal which ignores the dollar, the Russia-China oil deal which excludes the dollar, and (more importantly) China's potential global move towards de-dollarization with the creation of the gold-backed yuan-based oil contract system. Since China is THE major oil importer, accepting oil from Russia and Saudi Arabia almost equally (Russia, China, Angola top three) http://www.worldstopexports.com/crude-oil-imports-by-country/ if China were to squeeze Saudi Arabia to accept yuan instead of dollar, that would be a major shakeup.
But I digress.
Whether or not this affects the dollar depends on Venzueula's size as an oil exporter.
Now, most people think of Venezuela (if they think if it at all) as a small starving oil-producing nation headed by a chubby socialist wanna-be with a funny mustache and preternaturally bushy hair 
But Venezuela is the nation with the highest amount of PROVEN RESERVES ... not Saudi Arabia, Canada, Iraq, Iran, or Russia. https://en.wikipedia.org/wiki/List_of_countries_by_proven_oil_reserves
Furthermore, according to recent statistics, Venezuela exports about one-fifth of Saudi Arabia's production (2,000 Kbbl/day (thousand barrels per day) to Saudi Arabia's 10,000 Kbbl/day) ...
https://tradingeconomics.com/venezuela/crude-oil-production
https://tradingeconomics.com/saudi-arabia/crude-oil-production
... a not-insignificant amount of oil. While Venezuela's production has been higher in the past and is currently hampered by lack of spare refinery parts (thanks to economic sanctions), Saudi Arabia's oil production appears to be pegged where it is. I recall hearing, about ten years ago, that the Saudi oil fields were already depleted ("ruined" was the term used) and are having to be recovered with aggressive fracking and water-injection techniques. It's not something I've heard again until lately ... the point being that Venezuela has a lot of future headroom to increase its oil production, while Saudi Arabia may not.
So USA and Saudi policy may be time-sensitive- can the USA kill the current Venezuelan government before Saudi Arabia runs out of oil or before the world turns away from the dollar?
Lavrov will be visiting Venezuela, Cuba, and Brazil (also a major oil exporter) soon. Brazil, as you may know, is embroiled in a continuing scandal in which the least-corrupt official (President Dilma Rousseff) was impeached, only to have her replacement - bank/business-friendly Michel Temer- be indicted in the ongoing "carwash" scandal himself.
You should read this ... it's a nightmare of corruption, and probably describes Washington DC pretty well too.
https://www.washingtonpost.com/news/worldviews/wp/2017/09/13/meet-the-
corrupt-jailed-politician-who-has-the-rest-of-brazils-political-elite-terrified/
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Pity would be no more,
If we did not MAKE men poor - William Blake
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And people wonder why I'm not busting my ass to save for retirement now that I own my home...
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Is this relevant to the topic, Jack? Do you have any facts or logic on the topic to contribute?
Trump is not the problem. He set himself against the Deep State's agenda. And the Deep State's been heading for WWIII for years.
As for you, you're just a Deep State useful idiot, furthering its agenda. So I hope you enjoy cesium in your coffee. You've earned it.
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Quote:
Originally posted by 1kiki:
Is this relevant to the topic, Jack? Do you have any facts or logic on the topic to contribute?
Question 1: Yes
Question 2: Nope. That is, nothing other than saying that saving money in your 401k might not lead to that wonderful retirement that they sell it to you as.
Guess you're being pissy with me still, huh Keeks?
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EVEN SAUDI ARABIA IS GETTING INTO THE DE-DOLLARIZATION ACT
In order to understand the significance of that, you have to realize that it was the USA-Saudi deal under Nixon that created the "petrodollar" to begin with, and that Saudi Arabia has been THE cornerstone of the petrodollar for all of these decades.
Quote:Salman bin Abdulaziz Al Saud is said to be suffering from advanced dementia. The real power is with his son Crown Prince Mohamed bin Salman. Nonetheless, Salman bin Abdulaziz is still THE King of Saudi Arabia, and this is a real turning point in relations.
Russia, Saudi Arabia Announce Billons In Energy Deals, S-400 Missile System Purchase
Two days ago, when we previewed the first ever visit by a Saudi King to the Russian capital - a move which prompted Bloomberg to call Russian president Putin the "new master of the Middle East" - we pointed out that according to Russian Energy Minister Alexander Novak, a joint Russian-Saudi fund to invest in the energy sector will be announced during the forthcoming visit of the Saudi King to Moscow, and that the preliminary agreement to establish the $1 billion fund has already been reached.
Fast forward to today when diplomatic history was made on Thursday, when Putin met with the King of Saudi Arabia Salman bin Abdulaziz Al Saud - the first state visit to Russia by a reigning Saudi monarch
Quote:For comparison, total oil revenues for KSA are about $130 billion per year, depending on oil prices
- and the launch of a new level of relations between the countries, as well as billions in new energy-focused deals. The Saudi monarch's visit comes after decades of strained relations. More recently, tensions were high over the war in Syria. Russia and Iran have staunchly backed Syrian President Assad while Saudi Arabia has supported the Sunni rebels fighting to oust him. However, relations began to improve in recent years and Salman's heir, Crown Prince Mohammed bin Salman, has held several meetings with Putin.
There are also common points: the Saudi kingdom, much like Russia, has been hit by the fall in oil prices since mid-2014. Despite regional disagreements, the world's two largest oil-producers found common ground on energy policy in November, when they led a deal between OPEC and non-OPEC states to cut production in a bid to shore up crude prices. So far that deal is holding and prices have recovered slightly to above $50 a barrel. In an apparent reference to the output deal, Salman told Putin on Thursday that Saudi Arabia is "eager to continue the positive cooperation between our nations in the world oil market, which fosters global economic growth."
After the meeting, as noted before, the two countries launched a joint energy investment fund worth $1 billion
Quote:
which could include investments in natural gas projects and petrochemical plants. Among the deal signed, Saudi state oil firm Aramco, the world’s biggest energy company, signed a deal with Russian Direct Investment Fund (RDIF) and gas processing and petrochemicals company Sibur on joint projects in the area of oil refining. Amin Al-Nasser, Aramco chief executive said: "This marks a new milestone in business relations and partnerships with our counterparts in Russia. The visit by The Custodian of The Two Holy Mosques King Salman bin Abdulaziz Al-Saud to Russia will further enhance ties and will foster collaboration among Saudi and Russian companies on various fronts."
Aramco also signed a memorandum of cooperation with Russian state-owned oil company Gazprom Neft, to collaborate on drilling technologies and research and development areas, as well as employee exchange programs. According to the FT, Alexander Dyukov, chief executive of Gazprom Neft, said:
Given the ongoing macroeconomic uncertainties, it is of paramount importance that major oil producers coordinate their activities to improve the stability of the global oil and gas market. An important component of such engagement concerns sharing cutting-edgeNOTIFY: Y | REPLY | REPLY WITH QUOTE | PERMALINK | TOP | HOME
Quote:
Russia may soon issue its own official blockchain-based currency, the CryptoRuble
https://techcrunch.com/2017/10/15/russia-may-soon-issue-its-own-offici
al-blockchain-based-currency-the-cryptoruble/
As the USA pushes the "sanctions" button harder, harming the economies of its presumed allies and partners (specifically the EU) they will have greater and greater motivation to defect from the USD as the world reserve currency and medium of exchange.
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Pity would be no more,
If we did not MAKE men poor - William Blake
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Well, maybe. Or maybe not.
Quote:MORE AT http://www.zerohedge.com/news/2017-10-24/its-huge-story-china-launchin
"It's A Huge Story": China Launching "Petroyuan" In Two Months
China's plans for oil futures trading go back more than two decades, with the government introducing a domestic crude contract in 1993 and stopping a year later amid an overhaul of its energy industry. But in 2013, we first hinted at the birth of the petroyuan was looming...
In doing so China is effectively lobbing the first shot across the bow of the Petrodollar system, and more importantly, the key support of the USD in the international arena... setting the scene for the petroyuan.
And now, we are within two months of it becoming a reality as China prepares to roll out a yuan-denominated oil contract within the next two months...
"Approval of the trading rules by the securities regulator marks the clearance of a major hurdle toward launch of the contract," Li Zhoulei, an analyst with Everbright Futures, said by phone.
"The latest rules raised entry threshold for investors from the draft rules, which shows the government wants to avoid volatility when it first starts trading."
Which, according to Adam Levinson, of hedge fund manager Graticule Asset Management Asia, will be a “wake up call” for investors who haven’t paid attention to the plans.
A Yuan-denominated oil contract will be a “huge story” in the fourth quarter.
“The contract is a hedging tool for Chinese oil companies. We’re convinced Chinese oil companies will be anchor investors in the Aramco IPO.”
All of which fits with recent comments and actions from Russian and Venezuelan officials...
“Venezuela is going to implement a new system of international payments and will create a basket of currencies to free us from the dollar,” Maduro said in a multi-hour address to a new legislative “superbody.” He reportedly did not provide details of this new proposal.
Maduro hinted further that the South American country would look to using the yuan instead, among other currencies.
“If they pursue us with the dollar, we’ll use the Russian ruble, the yuan, yen, the Indian rupee, the euro,” Maduro also said.
Additionally, Levison warns Washington that besides serving as a hedging tool for Chinese companies, the contract will aid a broader Chinese government agenda of increasing the use of the yuan in trade settlement... and thus the acceleration of de-dollarization and the rise of the Petro-Yuan.
“I don’t think there’s any doubt we’re going to see use of the renminbi in reserves go up substantially”
g-petroyuan-two-months
Unless China insists on paying for Saudi oil with yuan or gold, this is just another brick in the wall, not "the" event which will collapse the dollar. China made a number of currency and financial moves, including funding the BRICS bank and the AIIB (Asia Infrastructure and Investment Bank), gold exchanges in Hong Kong and Shanghai, a petro-yuan-gold futures market, and (with Russia) a SWIFT-alternative banking backbone, and becoming part of the Special Drawing Rights (SDR) club at the IMF.
Altho the dollar has fallen in value since its peak (approx 1984)
it continues as the de facto standard for oil purchases (petrodollar) and reserve currency, partly because of weakness in the Euro. Part of this "lack of impact" from de-dollarization by China, Russia etc is that the economic and financial activities in the Eurasian arena don't pass through the BIS. For example, China's huge "one belt, one road" initiative doesn't factor into BIS calculations, and neither do the various oil-exchange agreements between Russia, Saudi Arabia, Iran, Venezuela and China, which are carried out either as barter or outside of BIS purview. What I expect is that the USD will continue to dominate wit
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While you guys ... that means you: SECOND, THUGR, KRAPO, and GSTRING .... have been pulling your porks over everything Trump-Russia ... you've let one of THE major geopolitical events go completely by you ...
As I last posted
Quote:
It would take a major shock ... the institution of a new global reserve currency by the IMF (for example, the issuance of a crytpocurrency backed by SDR) to push the dollar out of a "gradual fade" mode.
Well, that major shock might be about to occur. Not only has China issued/ activated a new "petro-yuan" (backed by gold) ...
Quote:
Treasurys Tumble, Futures Slide On Report China "To Slow Or Halt" Treasury Purchases
The treasuries complex has sold off aggressively across the curve after the following flashing red Bloomberg headline:
- CHINA OFFICIALS ARE SAID TO VIEW TREASURIES AS LESS ATTRACTIVE.
- CHINA OFFICIALS SAID TO RECOMMEND SLOWING OR HALTING TSY BUYING
As Bloomberg reports, "Officials reviewing China’s FX holdings have recommended slowing or halting purchases of US Treasuries, according to people familiar with the matter."
What does this mean?
IF true, it means that the USA has lost it's "petrodollar"edge. Since having the world's reserve/ petrodollar currency is what allowed us to run a trade deficit for DECADES ... buying goods with "funny money", without having any PRODUCTION to back it up .... once our dollar loses that status, we will be standing naked and without a credit card in the realm of world economies.
Decline not going to happen right away. What that means is that the USA will have to raise its interest rates to attract investors in Treasuries. Higher interest rates will make stocks and real estate and cryptocurrencies look less attractive. Bubbles will pop ... or at least, deflate.
Fun times ahead.
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Pity would be no more,
If we did not MAKE men poor - William Blake
America is an oligarchy
http://www.fireflyfans.net/mthread.aspx?tid=57876
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This one is going to break their brains.
Of course, it will all be Trump's fault though.
No blame to be put on Obama here, and GWB is just way to far back to even remember.
Thanks for the Quantitative Easing though. Made the economy look good enough to enough people for long enough for nobody to notice there was a major problem until it was too late. 
At this point, I just say fuck it. Let the chips fall where they may.
Do Right, Be Right. :)
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Quote:MORE AT https://www.bloomberg.com/news/articles/2018-03-08/how-china-is-about-
How China Is About to Shake Up the Oil Futures Market
By Sungwoo Park
March 7, 2018, 5:10 PM PST
From
China, the world’s biggest oil buyer, is opening a domestic market to trade futures contracts. It’s been planning one for years, only to encounter delays. The Shanghai International Energy Exchange, a unit of Shanghai Futures Exchange, will be known by the acronym INE and will allow Chinese buyers to lock in oil prices and pay in local currency. Also, foreign traders will be allowed to invest -- a first for China’s commodities markets -- because the exchange is registered in Shanghai’s free trade zone. There are implications for the U.S. dollar’s well-established role as the global currency of the oil market.
to-shake-up-the-oil-futures-market-quicktake
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Pity would be no more,
If we did not MAKE men poor - William Blake
America is an oligarchy
http://www.fireflyfans.net/mthread.aspx?tid=57876
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