Iran Makes Move to Devalue U.S. Dollar - Oil Trade in Euros

[broken_legs]

Iran Makes Move to Devalue U.S. Dollar, Opens Bourse Feb. 17


The Iranian Oil Bourse, a non-U.S. dollar forum established for the trade of oil, gas and petrochemicals, is set to open for business on Kish Island on Feb. 17, according to EIN News and Iranian television.

The Bourse had been set to open during the week commemorating the anniversary of the Islamic Revolution, said Iran's Foreign Minister Davoud Danesh-Jafari, but the Internet communication breakdown delayed the launch.


http://www.rigzone.com/images/news/library/maps/10/4915.jpg


The primary trade currency used by the Bourse will be the euro. The Iranian Bourse would establish a euro-based oil marker if successful.

The Iranian Bourse will be located on the Persian Gulf Island of Kish, a location Iran claims to be a free-trade zone.

The idea of the Iranian Oil Bourse first surfaced in 2005. At that time, the Bourse was due to open in March 2006, but the election of Iranian President Mahmoud Ahmadinejad delayed the opening of the trading forum because the president and parliament could not agree on the appointment of an oil minister.





Iran Oil Bourse Opens in Kish, Investment Hopes High


"With the launch of the first phase of the oil bourse, the private sector role will be enhanced in the oil industry," said Iranian Oil Minister Gholamhossein Nozari at the inauguration of Iran's Oil and Petrochemical Products Bourse on Feb. 17.

Nozari hopes that investments in Iran's oil sector will be facilitated with the opening of the bourse. Iran, the second-biggest OPEC oil producer, produces more than four million bbl/d.


Nozari and the Iranian Minister of Economy opened the bourse in Kish via teleconference from Tehran. The first transaction of the bourse was granted permission by Nozari and was authorized by the Economic Minister.

The Islamic Republic News Agency reported that the oil stock exchange is a two-phase project that will accommodate transactions made in Iranian rial.




I wonder what will happen to the US Dollar if the rest of the world starts trading in Euros...?

[rmk]

Wow. Them fighin' words :eek: :eek:

[Toma]

Originally posted by rmk
Wow. Them fighin' words :eek: :eek:
Well, when Saddam moved to do the same thing.... he got pown3d

[rmk]

^ You are right. This will get interesting.

[max_boost]

:eek: The collapse of the US dollar? Gold going up by default? haha $2500 Gold?:nut: :dunno:

[Rat Fink]

.

[badatusrnames]

Ugh. I was seriously considering buying up a bunch on gold when it was at ~ $660/ounce. How I regret.

[broken_legs]

Originally posted by badatusrnames
Ugh. I was seriously considering buying up a bunch on gold when it was at ~ $660/ounce. How I regret.

Money MAkeover on BNN:

They had a guest on who took out 50,000 dollars of equity from his house a few months back and bought all gold!



Anyways back to this Iran stuff. I think that Iran secretly has the backing of all the other OPEC nations.


Chavez supposedly had the support of 30 member states at a recent OPEN conference in Buenos Airies?

EDIT:

Found my info on Iraq switching to Euros....
http://www.feasta.org/documents/papers/oil1.htm




There is though one major obstacle to this happening: oil. Oil is not just by far the most important commodity traded internationally, it is the lifeblood of all modern industrialised economies. If you don't have oil, you have to buy it. And if you want to buy oil on the international markets, you usually have to have dollars. Until recently all OPEC countries agreed to sell their oil for dollars only. So long as this remained the case, the euro was unlikely to become the major reserve currency: there is not a lot of point in stockpiling euros if every time you need to buy oil you have to change them into dollars. This arrangement also meant that the US effectively part-controlled the entire world oil market: you could only buy oil if you had dollars, and only one country had the right to print dollars - the US.

If on the other hand OPEC were to decide to accept euros only for its oil (assuming for a moment it were allowed to make this decision), then American economic dominance would be over. Not only would Europe not need as many dollars anymore, but Japan which imports over 80% of its oil from the Middle East would think it wise to convert a large portion of its dollar assets to euro assets (Japan is the major subsidiser of the US because it holds so many dollar investments). The US on the other hand, being the world's largest oil importer would have to run a trade surplus to acquire euros. The conversion from trade deficit to trade surplus would have to be achieved at a time when its property and stock market prices were collapsing and its domestic supplies of oil and gas were contracting. It would be a very painful conversion.

The purely economic arguments for OPEC converting to the euro, at least for a while, seem very strong. The Euro-zone does not run a huge trade deficit nor is it heavily endebted to the rest of the world like the US and interest rates in the Euro-zone are also significantly higher. The Euro-zone has a larger share of world trade than the US and is the Middle East's main trading partner. And nearly everything you can buy for dollars you can also buy for euros - apart, of course, from oil. Furthermore, if OPEC were to convert their dollar assets to euro assets and then require payment for oil in Euros, their assets would immediately increase in value, since oil importing countries would be forced to also convert part of their assets, driving the prices up. For OPEC, backing the euro would be a self-fulfilling prophesy. They could then at some later date move to some other currency, perhaps back to the dollar, and again make huge profits.

But of course it is not a purely economic decision.

So far only one OPEC country has dared switch to the euro: Iraq, in November 20002, 3. There is little doubt that this was a deliberate attempt by Saddam to strike back at the US, but in economic terms it has also turned out to have been a huge success: at the time of Iraq's conversion the euro was worth around 83 US cents but it is now worth over $1.05. There may however be other consequences to this decision.

One other OPEC country has been talking publicly about possible conversion to the euro since 1999: Iran2,4, a country which has since been included in the George W. Bush's 'axis of evil'.

A third OPEC country which has recently fallen out with the US government is Venezuela and it too has been showing disloyalty to the dollar. Under Hugo Chavez's rule, Venezuela has established barter deals for trading its oil with 12 Latin American countries as well as Cuba. This means that the US is missing out on its usual subsidy and might help explain the American wish to see the back of Chavez. At the OPEC summit in September 2000, Chavez delivered to the OPEC heads of state the report of the 'International Seminar on the Future of Energy', a conference called by Chavez earlier that year to examine the future supplies of both fossil and renewable energies. One of the two key recommendations of the report was that 'OPEC take advantage of high-tech electronic barter and bi-lateral exchanges of its oil with its developing country customers'5, i.e. OPEC should avoid using both the dollar and the euro for many transactions

[broken_legs]

from: http://www.feasta.org/documents/papers/oil1.htm

The dollar is the de facto world reserve currency: the US currency accounts for approximately two thirds of all official exchange reserves. More than four-fifths of all foreign exchange transactions and half of all world exports are denominated in dollars. In addition, all IMF loans are denominated in dollars.

But the more dollars there are circulating outside the US, or invested by foreign owners in American assets, the more the rest of the world has had to provide the US with goods and services in exchange for these dollars. The dollars cost the US next to nothing to produce, so the fact that the world uses the currency in this way means that the US is importing vast quantities of goods and services virtually for free.


I don't believe the US will allow this to go on for too long.

[Canmorite]

$USD broke below important levels months ago. It's a slow, continous slide, with a domino effect.

[broken_legs]

heres some more:



http://www.feasta.org/documents/review2/nunan.htm

America's willingness to use violence to defend its economic interests does not seem to have reduced the number of oil exporters considering switching to the euro as they recognise that their use of the dollar enables the US to build up its military strength. In addition to Malaysia, Indonesia has the switch under consideration17 while Iran has been shifting its currency reserves into euros. Moreover, according to the Vice-President of the Iranian central bank, it has actually sold some of its oil to Europe for euros and is encouraging members of an Asian trade organisation, the Asian Clearing Union, to pay for Iranian oil in the European currency18 . Along with Malaysia, it is also at the forefront of efforts to establish a new gold-backed currency, the Islamic Gold Dinar, to be used in international trade amongst Muslim countries instead of both the dollar and the euro19 . In a further development, in June 2004, Iran announced that it had plans to establish an oil-trading market for Middle Eastern and OPEC producers which could threaten the dominance of London's International Petroleum Exchange and New York's Nymex20 . Such a move could help remove some of the technical difficulties that exist with a switch away from dollar-denomination of oil sales.

[vancouverwizard]

the war in iraq was over currency
the war in afghanistan is over the drug trade?

i'd like to share this video with you guys
the money masters !
http://video.google.ca/videoplay?docid=-515319560256183936&q=the+money+masters&total=1056&start=0&num=10&so=0&type=search&plindex=0&hl=en-CA

[Legless_Marine2]

Iran makes move to devalue the US dollar?

You must live in a box - The Americans have already devalued their own dollar, which is causing many around the world to switch from the dollar to the EURO - Not just Iran.

[vancouverwizard]

no sir, you have been watching too much of the tube box.
Iran is a major energy trader as was saddam.
if major powers as russia, india, and eventually china move there currency reserves to the euro because of iran, then there will be an economic disaster in America

[broken_legs]

Originally posted by Legless_Marine2
Iran makes move to devalue the US dollar?

You must live in a box - The Americans have already devalued their own dollar, which is causing many around the world to switch from the dollar to the EURO - Not just Iran.


Are you talking to me?

That was the title of the article D-bag :thumbsup:


The reason the US can continue to devalue their dollar and subsidize their imports is because the rest of the world has to carry US cash reserves to buy oil.

So if IRAN starts the ONLY exchange in the world where oil can be freely traded in currencies other than the US dollar the demand for the dollar will go down and devalue even further. Iran makes move to devalue the US dollar? Yeah... Kind of a big deal.

[mark4091]

Now all we need is McCaine to win the election, we got ourselves another war and a depression.

[2BLUE]

"The Bourse had been set to open during the week commemorating the anniversary of the Islamic Revolution, said Iran's Foreign Minister Davoud Danesh-Jafari, but the Internet communication breakdown delayed the launch"

The USA will go to all costs to cover their ass!

[pome902]

I smell the amero coming guys :dunno:
Us deserves it , them and brittain eff'd them over back in the day. =D

[vancouverwizard]

unfortunately nafta and the prospected Amero will threaten all Canadians like you and I... our children

checkout what the guy on our $50 bill said in the past


"Until the control of the issue of currency and credit is restored to government and recognized as its most conspicuous and sacred responsibility, all talks of the sovereignty of Parliament and of democracy is idle and futile... Once a nation parts with the control of its credit, it matters not who makes the laws....Usury once in control will wreck the nation."
http://en.wikipedia.org/wiki/William_Lyon_Mackenzie_King#Quotations

[The Cosworth]

why would the put it on an island, isn't that just calling for an ICBM

[broken_legs]

Originally posted by brendankharris
why would the put it on an island, isn't that just calling for an ICBM

"a location Iran claims to be a free-trade zone"

[Supa Dexta]

I'm just watching "the money masters", older, dry video, but quite interesting..

http://video.google.ca/videoplay?docid=-515319560256183936&q=the+money+masters&total=1056&start=0&num=10&so=0&type=search&plindex=0&hl=en-CA

[max_boost]

Here's an interesting article written by Warren Buffet 5 years ago in regards to the American trade deficit.

http://www.berkshirehathaway.com/letters/growing.pdf

So how exactly do you shift your currency reserves? Just put in on the market and have someone buy it? :dunno:

[pome902]

Originally posted by vancouverwizard
unfortunately nafta and the prospected Amero will threaten all Canadians like you and I... our children

checkout what the guy on our $50 bill said in the past


"Until the control of the issue of currency and credit is restored to government and recognized as its most conspicuous and sacred responsibility, all talks of the sovereignty of Parliament and of democracy is idle and futile... Once a nation parts with the control of its credit, it matters not who makes the laws....Usury once in control will wreck the nation."
http://en.wikipedia.org/wiki/William_Lyon_Mackenzie_King#Quotations


I wasnt refering to US deserving the amero ! i ment this issue with iran !

Nafta on steroids.... From what was on cnn martin and bush already signed this deal. It just hasent been taken into effect !

[retro-steve]

Well if the American dollar goes down the asshat Canadian economists will once again lobby for our dollar to be artificially devalued and with the US buying all our oil and making some excuse to pay for the oil in US dollars only, making not only all our oil more expensive, but all other products more expensive as our dollar is drastically devalued.