Dismiss Notice
Join Physics Forums Today!
The friendliest, high quality science and math community on the planet! Everyone who loves science is here!

News Petro-Dollars? part II

  1. Jan 12, 2006 #1
    Watched a TV programme the other ngiht about conspircay theories to do with the iraq war. After watching this i was still unsure as to what the term petro-dollar meant so had pengwuino look it up for me. He found this,


    which contains this.

    Now then i'm absolutely useless with economics but the other night the tv programme claimed that if the Oil was sold in euro's rather than the dollar then it could bankrupt America. That seems abit far-fetched to me but does that sound possible to anyone out there? And does it sound like Bush would go to war not to dfeat terrorism but to safe the US economy?
  2. jcsd
  3. Jan 12, 2006 #2


    User Avatar

    Here's an excellent article that examines this whole issue.
    http://ist-socrates.berkeley.edu/~pdscott/iraq.html [Broken] The full article is well worth a read.

    There are other sources of info on this topic available here

    http://www.chinathetimes.com/phpBB2/viewtopic.php?t=53&highlight= such as this;

    Last edited by a moderator: May 2, 2017
  4. Jan 12, 2006 #3


    User Avatar

    Staff: Mentor

    Well, I think the threat posed is overblown, but since currency is basically a product sold by the US Treasury, the more dollars in circulation, the more money the US government gets. If oil were sold with Euros, it wuld mean less dollars being bought from the US. So it would have an impact - how big is a matter of considerable debate.
  5. Jan 13, 2006 #4


    User Avatar

    Can you show us a source which argues in this debate that the effect on the US economy would be anything less than catastrophic????
  6. Jan 13, 2006 #5


    User Avatar
    Gold Member

    Our problem with Iran, as with Iraq, is more about oil and oil economics than anything else. If we were truly concerned only about nuclear weapons we would have to start with North Korea. What the Iranians have proposed to start in March may possibly change the world oil markets, and declares war on the petro dollar.


    IMHO the FEDS response to the possibility of a petroEuro instead of a PetroDollar was to start hiding M3 starting in March. This will make it difficult for financial analysts to track or predict the inflation which will come about as we will be paying more dollars per barrel of oil.

    http://forum.truthout.org/blog/?op=displaystory;sid=2005/12/23/125529/28 [Broken]

    http://www.bloomberg.com/apps/news?pid=10000039&sid=abJD2CVu7kHk&refer=columnist_baum [Broken]
    Last edited by a moderator: May 2, 2017
  7. Jan 15, 2006 #6
    Okay then, it would appear that the US economy will be badly affected by this so if this where to happen with how much force do you think the US governement will use to protect it's economy? Does anybody think that all this talk about Irans nuclear weapons research is just gonna be an excuse to use nuclear weapons against them?
  8. Jan 15, 2006 #7
    When US capital is threatened, conflict is bound to follow. The rhetoric in this CNN article (http://edition.cnn.com/2006/WORLD/meast/01/13/iran.nuclear/ [Broken]) suggests that they (the so-called 'international community') are gearing up for some drastic action right now, but I don't think nuclear weapons will be used against Iran - it's more likely to be a conventional military strike, and probably by Israel (as others have suggested). From what I've read, they're going to try for sanctions first - but sanctions take a while to be effective, so who knows? Another problem regarding the imposition of sanctions is that Russia and/or China may veto this proposal:
    But what I don't understand is if Iran is proposing to switch from US dollars to the Euro petrodollars, why is Merkel supporting Bush on this issue? Surely the switch to euros would favour the European Union? Does anyone have any ideas about what's going on here?
    Last edited by a moderator: May 2, 2017
  9. Jan 15, 2006 #8
    hmmm, it is very strange. I would have thought that the french and the germans would support the petro-euro so to have merkel come out and support bush on this issue doesnt quite fit. Unless she already knows that the US will not let Iran sell petro-euro's and she's just building bridges.
  10. Jan 16, 2006 #9
    This is my thought too, Andy - or perhaps there was some back-door dealing (or threatening?) done. Perhaps when we see how the actual vote pans out (who votes for what) we'll be in a better position to make a guess.
  11. Jan 16, 2006 #10
    I for one qould be interested in seeing/hearing that debate. I have not heard anything at all positive about the prospects for the US economy if oil is traded in euros instead of dollars.
  12. Jan 16, 2006 #11
    The only good thing I can think of will be that the US will have to use up less paper to make dolars, and perhaps they could lay off some people at the printing press. Other than that, well it is not good :biggrin:
  13. Jan 29, 2006 #12


    User Avatar
    Gold Member

    Maybe they are more interested in diverting WWIII, because WWIII would be far more devastating for all.
Share this great discussion with others via Reddit, Google+, Twitter, or Facebook