US-Saudi Arabia Petro Dollar Pact Ends – Joe Biden’s Failures Are Bringing an End to Global Dollar Dominance
By Jim Hoft Jun. 13, 2024
In March 2023, South Africa’s Foreign Minister Naledi Pandor announced that Saudia Arabia, United Arab Emirates, Egypt, Algeria, Argentina, Mexico, Nigeria, and other nations wanted to join BRICS Alliance. This was a direct threat to the West and US dollar dominance.
Via Kanekoa.
Was this always the plan for the Obama-Biden regime? To take down US dominance on the global stage? Because that is taking place on a rapid scale.
Under Biden, who is openly mocked on the international stage, traditional U.S. allies are now aligning with China
Saudi Arabia announced in March 2022 it was considering accepting the Chinese yuan instead of the US dollar in future transactions.
Last week Joe Biden allowed the 50-year-old petrodollar agreement between the U.S. and Saudi Arabia to expire.
Tip Ranks reported:
The term “petrodollar” refers to the U.S. dollar’s role as the currency used for crude oil transactions on the world market. This arrangement has its roots in the 1970s when the United States and Saudi Arabia struck a deal shortly after the U.S. went off the gold standard that would go on to have far-reaching consequences for the global economy. In the history of global finance, few agreements have wielded as many benefits as the petrodollar pact did for the U.S. economy.
The petrodollar agreement, formalized after the 1973 oil crisis, stipulated that Saudi Arabia would price its oil exports exclusively in U.S. dollars and invest its surplus oil revenues in U.S. Treasury bonds. In return, the U.S. provided military support and protection to the kingdom. This arrangement was a win-win situation for both; the U.S. gained a stable source of oil and a captive market for its debt, while Saudi Arabia secured its economic and overall security.
Oil being denominated in U.S. dollars alone has significance beyond the categories of oil and finance. By mandating that oil be sold in U.S. dollars (DXY), the agreement elevated the dollar’s status as the world’s reserve currency. This, in turn, has profoundly impacted the U.S. economy. The global demand for dollars to purchase oil has helped to keep the currency strong, making imports relatively cheap for American consumers. Additionally, the influx of foreign capital into U.S. Treasury bonds has supported low interest rates and a robust bond market.
But that is all ending now thanks to Joe Biden and his reckless economic and foreign policy.
The petrodollar’s expiration could weaken the U.S. dollar and, by extension, the U.S. financial markets. If oil were to be priced in a currency other than the dollar, it could lead to a decline in global demand for the greenback. This, in turn, could result in higher inflation, higher interest rates, and a weaker bond market in the United States.
It’s as if he is purposely trying to bring down our economy.
BRICS News reported:
The Biden agenda.
