Venezuela now pushing all of OPEC to accept Rubles and Yuan for oil after they dumped Petrodollar trade
Venezuela now pushing all of OPEC to accept Rubles and Yuan for oil after they dumped Petrodollar trade by Ken Schortgen – The Daily Economist
Now that Venezuela has gone about a month in their new policy of rejecting the dollar as a medium of exchange for oil, the South American energy power is calling for all OPEC nations to follow suit and begin accepting a basket of currencies such as the Euro, Yuan, and Russian Ruble.
The President of Venezuela Nicolas Maduro has proposed oil producing countries should discuss creating a currency basket for trading crude and refined products.
“Developing a new mechanism of controlling the oil market is necessary,” he said on Wednesday at the Russian Energy Forum, being held in Moscow this week.
According to Maduro, trading paper futures has an adverse impact on the oil market, undermining attempts by the Organization of the Petroleum Exporting Countries (OPEC) to stabilize prices.
Introducing alternative currency baskets, including the yuan, ruble, and other currencies will eliminate the impact of futures trading, according to the Venezuelan president. – Russia Today
Following President Trump’s implementation of economic sanctions on Venezuela back in late August, President Nicholas Maduro countered these trade restrictions by disconnecting his economy from the long-standing Petrodollar agreement that most of OPEC has followed for the past 44 years. However, Venezuela is not the first cartel member to ditch the Petrodollar as Iraq attempted this a decade ago, with the U.S. deposing their leader in Saddam Hussein in retaliation. And of course Iran was also forced to find alternative means for selling its oil following a decade long bout of sanctions imposed upon them by Washington which were tied to their nuclear program.
By offering the ability to buy or sell oil in currencies other than the dollar, nations will enable themselves a modicum of protection from the U.S. being able to impose restrictions upon them as a means of economic warfare. And as more countries become willing to follow Russia, China, Iran, and Venezuela’s lead in opening up oil sales and purchases to other currencies, the sooner the world will have the leverage to crack the uni-polar reserve currency system that is Washington’s key power base in controlling global foreign and economic policies.