© Zohra Bensemra / Reuters
"Ideas related to oil trade in currencies other than the dollar arose more than once. Some of them were severely suppressed by the United States, one example is Muammar Gaddafi, who proposed the introduction of a regional currency gold dinar and trading oil in the Middle East in this currency," Aleksandr Egorov, foreign exchange strategist at TeleTrade, told RT.
However, this time, an attempt to oust the dollar could be successful. China has launched oil futures backed by yuan, and Beijing has what Gaddafi didn't, according to the expert.
"Along with the Chinese role in the global economy and the growing interest in the renminbi, China is also protected by a nuclear shield. It can afford to try to shatter the monopoly in oil trade. This will give even more weight to the Chinese yuan. In addition, China's economy is the world's largest consumer of oil, and consequently, all world producers of raw materials will have to reckon with the strategy of the Chinese authorities," Egorov said.
According to the analyst, the timing for the launch of the petro-yuan is perfect. Key oil producers Russia, Iran and Venezuela are under pressure from US sanctions, and it is a good moment for them to ditch the dollar in oil trade and substitute it with the yuan.
Mikhail Mashchenko, an analyst at social network for investors eToro, agrees. "From the point of view of Russia's geopolitics, it is certainly beneficial to reduce the role of the dollar in foreign trade. And it has been done, let's recall the record growth of the country's gold reserves. The other states that are constantly under the threat of new sanctions, like Iran and Venezuela, can profit, too. The contracts in RMB will allow to trade oil without US approval," he told RT.
Both analysts agree that it will take time before the petro-yuan can become a real threat to the dollar. China needs to win the support of the world's largest oil producers Russia and Saudi Arabia, or the initiative is doomed, says Mashchenko. He added that the yuan is fully controlled by Beijing, which could also spook potential investors.
Reader Comments
China has been in involved in a trade deficit that started at the end of 1990's. A slow progressive movement that with time has increased. To a point in which China and Russia, for years, buy every day in the markets more gold that is being mined (produced) every day. This means “kind of a monopoly” in which all gold mined and sold goes to the hands of a few people in China and Russia. It seems that they have been preparing for a global market instability. And the potential fall of the dollar. I find out interesting to see in Russia the development for the system known as MIR (banking inter-operability system) and in China the development of CIPS (Cross-Border Inter-Bank Payment System). So both countries are now ready to disconnect themselves from the outside world (international payment system, SWIFT, ruled by NATO).The news systems also allow to operate between them: Russia(Mir) – to – China (CIPS). So if bad things happen in the world, they can try to survive on their own, and keep international payments running on “their technological platforms”. A keen analyst in the intelligence community should be aware of that. The process of de-dollarization has been ongoing for a decade. If NATO knows it, and do not act to counter-act it, this means something that is meaningful. There is a programmed collapse of the economy to redesign the west (NATO countries). And the East (some no NATO countries), are getting ready to face that change.
Someone in NATO must be aware of that, and are willing to commit to this plan of shared pain and suffering to bring forward and agenda of mass changes in the west. Expecting the outcome will be better or worth the pain. The existing problems with mass-migration and expenses in subsidies to offer an economic support for everyone (communism). Is to keep populace under control in a pathway towards instability. So pushing towards total chaos, to cause mass havoc on society. But using the economy to manipulate reality, because mass harm is to be released as planned. Not before they are ready to commit the next stage of “the plan”. Very difficult subjects to deal with. As there is information difficult to verify, that might be linked to conspiracy theories towards a new world order or the reshaping of humanity on the planet. On how to enforce sustainable development on humans. Even if they do not want to.
The changes in the economy management of China and Russia, offers some details to rethink what is going on around the world. Not in one place, but everywhere.
jordifs Whatever changes are coming, the anglo/zionist monetary system needs to be in place globally for it to succeed. All nations must be under its domain, no exceptions. Look at how vicious they were against Ghaddafi?, and Saddam Hussein. The Russians, Chinese, and others, are building an alternative system. The Eurasian landmass has most of the worlds resources, and workforce. So, their toilet paper fiat money is useless, unless everyone is in debt to it. This is the great headache the psychos have in the west. Also, corporations in the US outsourced their labour via neo-liberal economics into Asia, etc. So, what does the US have to sell, that anyone wants, eh?
In my view, their plans are screwed, and they are not in control. Hence the hysteria, and so on.