Tom Kirkman

“New US Sanctions on Iran Threat to Petrodollar”

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Presented without comment, for your consideration, here is an article from Iran Front Page:

New US Sanctions on Iran Threat to Petrodollar

US President Trump’s decision to pull the US out of the Iran nuclear deal has reinstated a number of sanctions that have put the petrodollar under threat.

The US’ withdrawal from the deal led to international condemnation, with European and Asian countries continuing to honour the agreement and trade with Iran. China will be one of the biggest beneficiaries of the US’ sanctions against Iran. China launched its Yuan-backed oil futures in April as part of its policy to expand the currency’s influence. Now that the US sanctions will affect Iran’s oil dealings, China will be able to continue expanding its influence by buying Iran’s crude exports.

A petrodollar is any US dollar that was used in the purchasing of oil. Most oil purchases by OPEC member states, Russia, and Canada are paid for in dollar. With “Petroyuan” now in play, which Russia will most likely support, the petrodollar will have its first serious contender in the oil market.

Iran already agrees with the idea of accepting Yuan as payment for oil exports. Even before the US removed itself from the Joint Comprehensive Plan of Action (JCPOA), Tehran declared that it prefers to trade in currencies other than the dollar, which Iran has little to no access. FXCM  published a long-form article on the petrodollar, which discussed how Iran sought payment for signed oil contracts in Euros instead of dollars in 2016. Now, apart from Euros, the country has a major currency backing its oil exports in the form of Yuan.

In April, the Iranian government signed a deal with Russia to conduct all of its business transactions in goods rather than in dollars in order to lessen the influence of the US sanctions.  ...

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The U.S. hates that Iran is resistant to their hegemony. This has been going on since the '50's. Iran is the de-facto #1 regional power in the M.E. and they have friends in Russia and China. Oh, and Iran is one of three countries that still has a central bank. The U.S. hates that.

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