Policy Pete: In Which Currency Should Oil Be Priced Or Does It Matter?

The idea of non-dollar payments has been floating around for years, but there are many reasons why it has never taken root.  Now an upstart Iranian venture has proposed to price oil in Euros and many in the middle east seem to believe that it will be the beginning of the end for the dollar.

The current system allows the US to overspend and rely on credit to support a lifestyle that is way, way overextended. US savings are actually negative, while indebtedness of all forms is growing by leaps and bounds. The necessary correction will occur at some point but when it does the disruption to the entire world system will be far greater than it needs to be. Starting to price oil in other currencies would add to the petroleum demand suppression effect in the US, provided that the reduction was not exaggerated by too much change occurring too quickly.

Policy Pete