UAE Warns US It Could Sell Oil in Chinese Yuan if War Drains Dollar Supplies, Triggering Biggest Threat to the Petrodollar Since the 1970s

He is setting up pardons for all his insider trading buddies.

I think it's time we entertain the idea that Trump didn't go into this war unplanned. I think he (or at least his people) has a pretty good idea on why they started it, how they want it to go, and what is the end game. Look at it. His personal and family wealth ballooned from insider trading, he's got unprecedented access to build his shitty hotels from capitulation, big daddy Russia made bank from the oil shortage, he found a good reason to withdraw support from Ukraine and East Asia, also laid groundwork for exiting NATO. Big win for himself and his interest. Another critical hint is that he captured Venezuela before Iran. That felt too intentional.

As someone who actually trades in RMBs, liquidity is *never* the reason to not trade in USD. If one currency is liquid like a brick it's the yuan. There is one reason only to trade in yuan, when your counter party is Chinese. There are no proper hedging tools, there is no proper trading securities, there is no proper trading platform it's a b****. But when you got Chinese clients, RMBs it is. So which begs the question, why is UAE saying this, because sure enough their trades aren't all with China. My 5 ct's, it's a bitchslap to Trump to get his shit right. Imagine being UAE, you just gave this orange c*** an airplane and whatyouknow, he starts blowing up your neighbours and you are suddenly fucked because this dumb c***.

Trump has always had a plan. Make money for himself and his circle. Global disruption means volatile markets. When you create the disruptions you can easily profit.

ELI5 about why it matters which currency oil is traded for?

How is Iran selling oil if the USA is not letting Iranian vessels through the blockade?

Shart of the deal

Iran is trading oil in yuan not because they want to threaten the usd but because they don't have access to usd or EUR due to sanctions so yuans are literally their only choice to avoid complete and utter collapse. The idea that the yuan could somehow replace the petrodollar over Iran of all places is pretty stupid. Iran never traded oil in USD, and places like the UAE have no interest in buying excess yuan that they would exchange into USD or invest in the US market anyway - both because the yuan is tightly controlled by the Chinese government and not fully convertible, and because a. Chinese bonds are illiquid and with very low yields b. the Chinese stock market is trash and unreliable c. the Chinese property market is a dumpster fire (plus nearly inaccessible to foreigners). That's because the Chinese government doesn't really want the yuan to replace the petrodollar, as it would be actively against its own interest. So the UAE would have no incentive to keep yuans around, and Iran changes very little, Iran is not a meaningful financial player in global markets or even oil trading markets. Outside of physically blocking the strait, their oil exports are basically worthless. What is potentially more concerning for the US is Gulf allies re-evaluating US military presence in the region, although I'd wager they're not too happy with having Iran unleashed next door.

It's okay, he has the concept of a plan.

Putin probably is the one who tells orange pedo to do it because he wants high oil price

One reason Trump moved in without any plans because Iran started selling oil in Yuan and Iran showed interest in joining BRICS nations.

Iranian oil doesn’t really matter as it really only goes to China and is now under blockade. And now that they can’t export any oil their economy is at real risk of collapse in the game of chicken.

>Trump kicked the hornets nest into our yard with no plan, no ideas and no repercussions for him. 1) More oil money for Putin, this makes the Russian regime happy 2) More money for Trump's crony insider trading friends, this makes Trumps regime happy. 3) Israel taking vengeance on Iran and expands it's borders, this makes Bibi's regime happy. 4) Dollars gets weakened, this makes the project 2025 cristofacsists and the silicon tech bro facists happy. Meanwhile 349 million Americans suffer and so does the entire world on the higher oil prices, but you know that's what Americans voted for. Suffering for them and the world.

Inflation would've been way down without all this war and tariff BS. Rates would've been cut. Instead inflation is still way too high. So average americans have less money in their pockets because of him.

Cool cool... Then why do the rest of us Non-Americans also have to suffer for this? High prices, tariffs, threats of annexation, war, etc?

I’ve heard people who scam maga with ai are doing really well right now. Apparently the scam only works on them, for some reason

Trump is so obsessed with Obama and Biden that I think he may actually be in 💕 with them.

Shut up dude! ThE dOw Is At FiFtY tHoUsAnD!

Lol guaranteed they are screaming that over on fox.

"Look, obviously, the military action in Iran didn't achieve what we wanted, but President Trump was trying to free our so-called allies in Europe and the Middle East from the straitjacket that Iran placed around them. A straitjacket that Europeans and others simply found way too comfortable. I don't like how the situation played out, but I don't fault President Trump for his ambition; a quality we used to praise in this country!" \- Republican Presidential Candidate Speaking for 45-55% of the Electorate in 2028

I don't know about that. The UAE seemed to have been positioning itself firmly in the US/Israel camp for quite a while. And it was the UAE that allegedly launched an attack on Iran after the ceasefire was in place, and it was alledged that the UAE allowed it's territory to be used as the launchpad for HIMARS strikes. So I get the feeling this is the UAE trying to force the US into taking military action, rather than any actual intent to abandon the petrodollar.

Which is a bit late because the US is in this war to make money from high oil prices due to them being the worlds biggest oil and gas supplier, helped in no small amount by their recent takeover of Venezuelan oil. Leopards appear to be eating your face UAE (and other middle eastern petrostates that supported the war).

This. But their infrastructure is destroyed, money is not flowing and they are sitting ducks if Trump does escalate

That’s not at all what they’re saying. They’re pressuring the White House to move along emergency aid to affected middle eastern countries. They WANT dollars and have been privately pressing the administration to continue the war No clue where on earth you got your interpretation from

Well, it's the UAE letting the US know the limit of what they're willing to tolerate as part of their arrangement. An ally is only that for as long as the benefits outweigh the costs.

I mean why would the gulf states be allies with the US? they were allies of the US because the US offered protection from Iran, their main enemy (lol), and protected trade of their critical assets, and a safe currency to build an economy on allying with the US served them in the passed, but clearly its not offering what it was anymore

> I think they are just the first to say anything. End of March Saudi Arabia was rethinking its US investment and reliance after Trump said publicly that he liked how much MBS was kissing his ass.

Why would yuan appreciate? RMB is not a clean float currency and currency determination is an evolving field of study. Pure fiat systems were only built in our generation so this is all a huge ongoing experiment. If you ask me, Id rather hold a currency from a country that is fiscally responsible, politically stable and has significant foreign reserves (Singapore, Swiss) RMB is currently 2, 3 depending on which side of the world you are in, of those things.

There are 2 times more yuans in circulation than there are US dollars. The ecosystem can soak up oil money just fine.

Two words: national debt.

After the U.S. ended the gold standard in 1971, the government sought to maintain the dollar's global dominance. In 1974, the U.S. entered into a deal with Saudi Arabia, establishing the Joint Commission on Economic Cooperation to provide technical assistance in exchange for pricing oil in dollars. OPEC nations accumulated massive surpluses of USD, which they re-invested into US Treasuries and western banks, creating a "virtuous loop" of demand for the currency. The petrodollar system, established in the 1970s, anchors U.S. financial dominance by pegging global oil sales to the US dollar. Born from agreements with Saudi Arabia, it forced nations to accumulate dollars, which were "recycled" into US Treasuries, lowering American borrowing costs. Essentially, this made countries have to buy US dollars with their own currency to get oil.

Without the Petrodollar, the US Economy will tank. No pun intended.

Petrodollar isn't a thing because of the US importing oil from the Gulf. It's a thing because of Gulf countries trading in USD with other countries and investing the revenue in the US market.

People always speak about the petrodollar like it needs to be fully replaced with another currency. With the world order becoming a multipolar one its just as likely the same will happen with the currency. Not a single reserve currency, but multiple. As long as their isn't a prosperous and benign hegemon, there will not be another version of the petrodollar.

I believe that was the right thing to do, since Trump ask Taiwan for $ 100 Billion as protection money.

It’s only kmt leader tho. It won’t really affect much as long as dpp holds the reign for two more years. Altho many Taiwanese are sick and tired of being buttfucked by trump on every deal and are leaning more and more towards a peaceful relationship with China.

Essentially, if oil can only be bought in dollars, third-party countries have to buy dollars with their own currency to get oil. Whenever someone buys a currency, the value of that currency goes up, and whenever someone sells a currency, the value of that currency goes down. For small transactions, this amount is infinitesimal, but if enough large transactions occur, this has a real effect, which means that the dollar's value is raised by these trades. This has two main effects: - One, because countries trade their own currencies for the dollar, some level of inflation is effectively transferred from the US to other countries. - Two, because demand for the dollar is high, US bonds become more desirable, which allows the US government to lend more money at lower rates. The problem for the US is if it stops. For the former point, both theory and practical results when the British Pound lost a similar type of status that it used to have, all that exported inflation comes back. This means a massive cost-of-living increase in the US, which US citizens are generally ill-equipped to deal with, as US households assign a low percentage of income towards savings/buffer. For the latter point, if the US stops being able to run a deficit, has to service its existing debt at higher interest rates as it renews, and has to raise a serious surplus to pay down now-crippling debt, you're looking at something like a doubling of tax rates with no additional services offered, or a 50% increase in tax rates and simultaneous abolishment of long-running programs like Medicare. This, of course, compounds with a massive cost-of-living hike from the other point. It is not immediately obvious how the US can or will deal with this, as policymakers have deferred appropriate preparations for decades, and it has instead set itself up for maximum exposure and damage if current conditions collapse.