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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: SGJ who wrote (25667)	12/18/2000 8:34:22 AM
From: edamo	Read Replies (1) \| Respond to of 65232

qcoman...."dollar/euro/oil" when the dollar falls, oil pricing tends to rise....as you know oil is priced in dollars...if i am a producer, then when i make conversion to local currency, i would receive a lesser amount if dollar is weak against my currency. that is the reason why the saudi rial floats with the dollar. if you go to the original opec charter, you will see a factor for currency conversion that is used in opec oil pricing. very little oil produced on the euro continent....one of the reasons the uk has resisted the euro is due to the fact they are an oil producer.... do some research, currency is a minor part of international trade...most large exporters/importers avoid the vagaries of currency by hedging with currency futures when a supply contract is established. currency is always a good excuse for failure to penetrate a foreign market....real reasons such as local production, and ability to market and sell based on local custom is a more realistic reason... remember also that the euro is not a monolithic currency, it still uses an exchange rate formula in member countries, conversion is not equal...e.g... italian lira may convert to less euro then german mark.