« Greenwald Kung Fu | Main | Immigration Hardball »
November 19, 2007
OPEC and The Dollar
I'm just thinking out loud here (big disclaimer -- I'm not an economist!). What if OPEC decided to switch from the weak dollar to the euro? And let's say OPEC priced a barrel at, say, 90 euros. A barrel of oil would cost $131, based on today's exchange rate. OPEC would boost the euro, making Europe happy, while pocketing billions of additional American dollars.
By the way, it's worth noting that in November, 2000, pre-invasion Iraq began to price its oil based on the euro. According to Project Censored (quoting The Nation and The Sierra Times), the value of the euro began to increase and the dollar, well, you know. Guess how Iraqi oil is priced now? The dollar. And guess which OPEC nations want to drop the dollar now? Iran and Venezuela.
Am I way off or in the ballpark?
UPDATE: We dodged a bullet:
Ahmadinejad claimed OPEC's member countries want to convert their cash reserves into a currency other than the depreciating U.S. dollar, which he called a "worthless piece of paper."Chavez said the dollar was in free-fall and that its "empire" must end, and proposed trading oil in a basket of currencies excluding the dollar.
Both were unable to generate support from enough in the 13-member cartel — many of whom, including Saudi Arabia, are staunch U.S. allies.
One thing should be clear here, though. These nations don't need nuclear weapons. Just the oil.
Posted By Bob Cesca | November 19, 2007 08:37 AM | DIGG ME!
Comments
Obviously, since everyone is talking the dollar down, now is the time to buy.
Posted by: M. Simon ![[TypeKey Profile Page]](http://www.bobcesca.com/nav-commenters.gif)
at November 19, 2007 09:49 PM
Post a comment
Thanks for signing in, . Now you can comment. (sign out)
(If you haven't left a comment here before, you may need to be approved by the site owner before your comment will appear. Until then, it won't appear on the entry. Thanks for waiting.)
