I’m confused because of all the things that I heard about the end of the petrodollar. Then I stumbled upon this article here, but I cannot comprehend the whole context:
[Article that claims there is no such thing as a petrodollar agreement](https://www.morningstar.com/news/marketwatch/20240615261/reports-of-the-petrodollar-systems-demise-are-fake-news-heres-why)
In: Economics
The story is that SA had an agreement that all oil sales would be in usd. The ending of this agreement is an indicator that the strength of the dollar is waning fast.
In fact no such agreement existed, it was just useful for SA to denominate sales in usd.
Most of what you hear about the end of the use of the dollar for oil purchases is at best uninformed and at worst propaganda. It’s not easy to simply replace the world’s reserve currency.
One question that people who say this struggle to answer is what currency would replace the dollar. The other widely traded currencies like the Euro or Pound Sterling are still very much within the “Western” world and aligned to American interests.
Furthermore the idea that the currency will be the Chinese RMB is also fanciful as that would require China to loosen its own currency and capital controls and let a large amount of RMB out of China. This would mean China becomes unable to artificially keep the RMB weak, since other countries with large RMB reserves would be affected and wouldn’t trade at the low rates the Chinese would want.
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