Chinese expert: A decision from Saudi Arabia may “explode” the oil and dollar markets
A Chinese expert said that the conversion of the Saudi oil company “Aramco” to the yuan instead of the dollar in trade with China would be a “real explosion” for the oil market, with serious consequences for the global financial system.
This came after media reports that Saudi Arabia is considering using the yuan to settle oil deals with China, and the dialogue between Russia and India on the establishment of a commercial payment mechanism in the Indian rupee and the Russian ruble, and Western public opinion in general began talking about weakening the dominance of the dollar in the global oil market.
Zhang Yujui, dean of Shanghai University’s School of Finance and International Trade, said in an article published on the Huánqi Shíbào website . That Saudi Aramco, a company with revenues of more than $350 billion annually, will have an impact on the global energy commodity trading market if it moves with China from the dollar to the yuan in dealing in the oil sector.
Yugoi noted that according to some studies, a country’s currency cycle, which serves as the dominant international currency, is usually around 100 years old. “If this view is correct, then from the moment the Bretton Woods system was created in 1944 for the dominant dollar dividend cycle, there is little time left before that system collapses,” he said. As reported by RT link
A storm hits the oil market… an incident that is expected to push prices to $150 a barrel
An accident that occurred this week at an oil pumping station in the Russian port of Novorossiysk stopped crude supplies through this route, amid expectations that this would push oil prices to $150 a barrel.
Reports stated that a severe storm hit the Russian port of Novorossiysk, on the Black Sea, which damaged the crude pumping station of the “Caspian Sea Pipeline” consortium, which affected the supply of black gold.
According to reports, the accident occurred on March 20, and caused two-thirds of the station’s capacity to be disrupted for at least a month. Yesterday, Russian Deputy Energy Minister Pavel Sorokin warned that the suspension of the offshore station would have serious repercussions on oil supplies and reduce them by about one million barrels per day.
The Russian Deputy Energy Minister indicated that maintenance work is likely to take a month, pointing out that the accident will affect oil exports from Russia and Kazakhstan through the Caspian Sea pipeline.
Regarding the repercussions of the incident on global oil markets, Igor Yushkov, a senior analyst at the National Energy Security Fund and an expert at the Russian Government’s Financial University, believes that this may push the price of oil to a sharp rise.
He pointed out that the incident came at a time when the global oil market recovered from a shortage of supply, as demand exceeds supply, so it may push the price to 140-150 dollars per barrel.
Earlier, the “Caspian Sea Pipeline” consortium explained that the storm damaged the pipeline’s loading equipment. The Caspian Sea pipeline is one of the largest oil pipelines in the world and transports oil from Kazakhstan and Russia to world markets link
Where is the Iraqi people’s budget for 2022?
We are now in the middle of the third month of 2022 and most countries of the world have issued their general budget for the aforementioned year, with the exception of Iraq, which we, the economic elites, did not know where the general budget is.
Was it prepared? Is it still in the corridors of the ministries of finance and planning? In preparing them on the items as usual, or did they adopt economic programs and plans?
In fact, no one knows and we only know that Iraq’s budget for several years is not approved and issued until several months after the budget year because of the problems and political quarrels between the political blocs and those who forgot that the budget is the budget of the Iraqi people and the budget for the implementation of investment projects and projects of reconstruction, construction and economic reform.
How long will the patient people suffer this injustice and the encroachment on their rights in this repeated way every year?
The current and expected financial situation for Iraq until the end of the year is very good, as oil prices will not be less than $100 per barrel. It fulfills its obligations towards internal and external debts, establishes its sovereign fund, and overcomes a real budget deficit for the first time in years.
Therefore, in the face of this reality requires taking quick measures by approving the budget by the new government and Parliament, with a date not exceeding the first half of this year, and to include the following priorities: ‐
-1. Re Revenue structure towards activating and stimulating the productive sectors, especially agriculture, industry, housing, services and tourism, and increasing the proportion of the contribution of income sources other than oil to the budget revenues.
2 – Increasing the investment allocations in the budget, including at least the completion of projects whose implementation rate exceeded 50%.
`3.Giving a role to the private sector in investing in reconstruction and infrastructure projects in Baghdad and the governorates
4- Allocating an amount to establish the Sovereign Fund (the Generation Fund) from the savings achieved from the increase in oil prices, and it is managed by a specialized board of directors, and its funds are invested under the supervision of the Central Bank and the supervision of the Financial Supervision Bureau.
`5. Allocating a special amount to the Ministry of Commerce to secure strategic storage for foodstuffs covered by the ration card for a period of no less than 3 months.
Increasing the ration items to reach 10 items. Allocating funds to support the prices of flour, rice, sugar and baby milk.
`6.- Allocating an amount to activate and support the agricultural, industrial and tourism sectors and to support the local product.
7.- Allocating an amount to the Ministry of Labor to cover the increase in the number of people covered by social care, to cover the increase in their salaries at a rate equivalent to the reduction in the Iraqi dinar exchange rate, to cover the financing of small and medium projects, and to include the displaced who cannot be returned to their homes
with social care.
* Economic and banking consultant link
Source: Dinar Recaps
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