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Putin Tells Europe to Pay for Natural Gas in Rubles
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<blockquote data-quote="RDKirk" data-source="post: 76611025" data-attributes="member: 326155"><p>For sure, that's what China wants. Purchasing oil in yuan props their currency and saves them money.</p><p></p><p>But that continues, however, to be a delicate issue for the Saudis. As far as I can tell, there would not be any benefit to the Saudis...the Chinese need their oil--everyone needs their oil--so they lose nothing by continuing to sell only for US dollars. They will always sell as much oil as they pump, even in US dollars.</p><p></p><p>The petrodollar deal allows them to buy US Treasury bills at a low rate before they go on auction and get bid higher. The petrodollar deal also makes the US their "bodyguard" (that's the real reason the US was Johnny-on-the-spot to protect Saudi Arabia and Kuwait from Saddam Hussein), and it gives Saudi Arabia access to nice American military toys. The Saudis would have to consider whether they can depend on the Chinese for their defense and their weaponry.</p><p></p><p>While the US dollar might not seem as sturdy as it once was, the US government can always be expected to do what makes money...a consistent, predictable motivation every other nation can expect. </p><p></p><p>The Chinese...not so much. There is no confidence that the Chinese will always do the thing that makes money. They're not beyond convulsive actions that hurt even them in the short run to maintain power in the long run...that's a much dicier trading partner.</p></blockquote><p></p>
[QUOTE="RDKirk, post: 76611025, member: 326155"] For sure, that's what China wants. Purchasing oil in yuan props their currency and saves them money. But that continues, however, to be a delicate issue for the Saudis. As far as I can tell, there would not be any benefit to the Saudis...the Chinese need their oil--everyone needs their oil--so they lose nothing by continuing to sell only for US dollars. They will always sell as much oil as they pump, even in US dollars. The petrodollar deal allows them to buy US Treasury bills at a low rate before they go on auction and get bid higher. The petrodollar deal also makes the US their "bodyguard" (that's the real reason the US was Johnny-on-the-spot to protect Saudi Arabia and Kuwait from Saddam Hussein), and it gives Saudi Arabia access to nice American military toys. The Saudis would have to consider whether they can depend on the Chinese for their defense and their weaponry. While the US dollar might not seem as sturdy as it once was, the US government can always be expected to do what makes money...a consistent, predictable motivation every other nation can expect. The Chinese...not so much. There is no confidence that the Chinese will always do the thing that makes money. They're not beyond convulsive actions that hurt even them in the short run to maintain power in the long run...that's a much dicier trading partner. [/QUOTE]
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Putin Tells Europe to Pay for Natural Gas in Rubles
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