BRICS, Saudi Arabia & the End of the Petro-Dollar: Oil to be Sold in Multiple Currencies
The global energy landscape is shifting dramatically. For over five decades, a landmark agreement dictated how Saudi Arabia sold its oil, shaping international finance. This allowed Saudi Arabia to settle oil payments in the U.S. dollar and not local currencies for over five decades. Now, a monumental change is underway.
Saudi Arabia Breaks Free: Moving Beyond the Dollar
Saudi Arabia has decided not to renew its 80-year petro-dollar deal with the United States. Now Saudis can sell oil and other goods in multiple currencies, including the Chinese yuan, Japanese yen, and Indian rupee. This marks a significant departure from the long-standing petrodollar system and opens up new avenues for international trade and financial independence.
Oil in Yuan, Yen, and Rupees: A New Era for Global Trade
The Kingdom is now free to sell oil in local currencies like the Chinese yuan, Japanese yen, and Indian rupee. This decision is poised to have far-reaching implications, potentially reshaping global currency dynamics and reducing reliance on the U.S. dollar for international oil transactions.
BRICS and the Potential Benefits of Multi-Currency Oil Sales
The BRICS bloc will be the first to benefit if Saudi Arabia adopts multi-currency settlements for its oil exports. This could strengthen economic ties between Saudi Arabia and BRICS nations, fostering greater cooperation and trade within the bloc. While Saudi Arabia has held off formally joining the BRICS bloc of nations despite attending a meeting in Brazil last week, two sources said, finessing an issue that could upset existing geopolitical balances, this move towards multi-currency sales aligns with the BRICS nations' desire for a more diversified global financial system.