Sunday, February 10, 2008

OPEC to Trade in Euros?

OPEC Secretary General Abdalla El-Badri is quoted in the Middle East Economic Digest as suggesting that the world's oil producers may switch from the dollar to the Euro as the international currency for oil transactions in the future.

Citing the declining strength of the dollar in the world markets, El-Badri has suggested that such a move could take place "within ten years".

American fears over such a move (which would significantly weaken the strength of the US dollar as its demand fell) have been intensified in recent weeks with the expected-opening of the Oil Bourse in Iran which, uniquely among markets trading in gas, oil and petrochemicals, will be a dollar-free zone, with transactions taking place in a variety of other currencies.

The opening of the Oil Bousre has been delayed due to recent disruptions to the Internet as a result of the severing of a number of cables in the seas around Iran and North Africa - a development reported on previously on this blog.

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