Gus > Maybe then US lawmakers will realize why their Indian counterparts have risked violating US sanctions laws on Iran that forbid such bold initiatives by New Delhi toward Iran. And these, by all accounts, are not limited to energy, but include the entire gamut of economic, trade, cultural, political and even security cooperation.
And the situation is even worse now that Iran has dropped the dollar as the medium of exchange for oil sales. Looks like the sanctions are just so much hot air and are being violated left and right as it is becoming clear the US is unwilling/unable to support its threats with action. Indeed, with the oil price at $120, and the US the biggest consumer of oil, it's clear the US has been hoist on its own economic petard and is the biggest victim of its own policies.
economictimes.indiatimes.com
>>Crude jolt for US as Iran scraps oil trade in dollar
With Iran, the world’s fourth-largest oil producer, shifting its crude trading to the euro and the yen, instead of the US dollar, treasury managers feel that this could well be the first challenge to the US dollar’s dominance as currency of global trade.
On Wednesday, Iran decided to make all transactions with euros in Europe, and the Japanese yen within Asia. This was largely triggered by the tensions between Iran and Washington for the past few years and lately, due to the weakening of the dollar. Despite its weakened position against almost every currency last year, the dollar has continued to dominate as currency of trade.
Iran is a member of the Organisation of Petroleum Developing Countries (Opec) and ranks amongst the world’s top three holders of proven oil and natural gas reserves. Iran has also vowed to lower the volume of dollars in its foreign trade, apart from its foreign reserves. <<
bloomberg.com
>>Gulf States May End Dollar Pegs, Kuwait Minister Says
May 1 (Bloomberg) -- Gulf states are considering dropping their pegs to the dollar after the U.S. currency's decline stoked inflation across the region, Kuwaiti Finance Minister Mustafa al- Shimali said.
``Yes, there are some'' Gulf Cooperation Council states considering dropping their pegs to the dollar, which has fallen 13 percent against the euro in the last 12 months, al-Shimali said in an interview in Kuwait late yesterday without naming the countries. ``Some countries will do what we are doing.''
Al-Shimali's comments may restoke speculation of a change in Middle East currency systems that eased after the United Arab Emirates and Qatar last month ruled out any revaluation or dropping the dollar peg in the short term. The issue will remain a key issue as long as inflation remains high.
``Inflation is rising in the Gulf to a great extent because of loose monetary policy,'' said Marios Maratheftis, head of research for Standard Chartered Plc in the Middle East in a telephone interview from Dubai. ``Tightening monetary policy can only happen if they drop their currency pegs or strengthen the currency, preferably both.''<<
Looks like the rats are trying to leave the burning ship. |
