The end of petrodollar. Any impact on crypto?

[pawel7777]

https://www.indiatoday.in/business/story/saudi-arabia-ends-80-year-petro-dollar-oil-with-us-dollar-for-multi-currency-sales-2552844-2024-06-13

In Short

• Saudi Arabia ends 80-year petrodollar deal with US
• Deal allowed Saudi oil sales in US dollars only
• Saudi can now use other currencies like RMB, Euros, etc

I expected this to have a big impact on stock markets and, by extension, on cryptocurrencies, but, so far, nothing significant has happened, other than USD dropping a bit.
Could it be that a weak Dollar is actually good for US companies, and US indices could still hold strong despite the US slowly losing its dominant geopolitical position?

Do you expect this will have any major impact on the markets in the near future, including the cryptocurrency market (which still tends to be correlated with traditional stock markets)?

[yhiaali3]

It is true that Saudi Arabia has ended the oil-for-dollar deal with the United States, but do not expect a quick change, because the problem is not only in selling oil against the US dollar, but there is also the pricing of oil, which is done in dollars, as the US dollar is the main reserve currency in the world, and It is currently difficult to separate the pricing of selling oil from the dollar, as the decoupling process will probably take many, many years until we see any significant impact on the market.

According to an article I read on CNN Economics:

Saudi Arabia may face increased exchange rate risks if oil sales are made in multiple currencies, which may affect the predictability and stability of its revenues, as dealing with multiple currencies increases the complexity and costs of transactions, which affects net revenues, although there may be short-term challenges. Diversifying the currencies in which it receives payments may allow Saudi Arabia to manage its reserves more strategically, which could lead to stable revenues in the long term.

Therefore, do not expect immediate change, but rather the change will be gradual and in the long term.

[TomPluz]

I am sure that the impact of this development - the end of the so-called petrodollar deal of USA with Saudi Arabia - will not be felt immediately as that is not how things work in the international commerce scene. Probably, it would take 2 to 5 years before we can finally see how this development can be affecting the US Dollar as the international reserve currency and how things can specifically brought some negative effects on the US economy. Actually, this is just one of the troubling things for USA and we can categorize this one under the dedollarization movement. How the USA will be reduced to a second-tier economy will be something exciting to watch though this can certainly affecting all of us as only a very few countries got no ties to USA economic behemoth.

[Captain Corporate]

Trying to lower the power of USA is not some new stuff that people are trying to achieve, a lot of nations tried it for many decades now, it won't work, you can't make USA or dollar less valuable, I mean YOU can't, other nations, what will end up is that USA will destroy itself within. They are such a weird nation that they are way too strong against everyone else, so Russia, Saudi Arabia, China, and every other nation in the world could get together and can't make even a slight dent into American economy. However, they could just make a few weird laws and destroy themselves within lol.

[LogitechMouse]

~
I expected this to have a big impact on stock markets and, by extension, on cryptocurrencies, but, so far, nothing significant has happened, other than USD dropping a bit.
Could it be that a weak Dollar is actually good for US companies, and US indices could still hold strong despite the US slowly losing its dominant geopolitical position?

Do you expect this will have any major impact on the markets in the near future, including the cryptocurrency market (which still tends to be correlated with traditional stock markets)?

I don't see a short-term effect, but a long-term effect.
I'm not an economist, but I'm pretty sure that this will affect the US Dollar... but not that much as many are expecting it. Even this deal is over already, most of the countries are still using the US dollar. Yes, we know that the Saudi is the main producer of oil globally, but that doesn't mean that the US Dollar will be that weak like what most are expecting.

The dominance of the USD will still at its highest. What the BRICS are doing will take decades until they achieve what they want and that is to ditch the US Dollar completely. This is just the first step of it. As for the impact towards the crypto, I can't think of any aside from the fact that if the US Stock Market will be affected negatively, crypto will follow it's price movement.

[pakhitheboss]

The recent declassified footage by the FBI, where an intelligence officer of Saudi Arabia is shown doing recky of different locations in the US before the 9/11 can create pressure on MBS to again start selling oil for USD. The timing is so great as there always have been speculations that the Saudi government was involved in those terrorist attack. We will need to wait and see what happens next. I personally do not think that those declassified footage will create any kind of pressure on the Saudi government.

[Husires]

There is no good alternative to the dollar. If any country decides to abandon the dollar, it will not find an ideal alternative. The euro is weak and is affected by the dollar. The Chinese yuan is low in value and China will not try to increase the value of its currency. The Russian ruble is not a good alternative, and the rupee and other currencies of emerging countries are far from being an alternative to the dollar. Countries will try to return to the barter system or purchase with gold, but it is difficult to replace the dollar for international trade.

[target]

The recent declassified footage by the FBI, where an intelligence officer of Saudi Arabia is shown doing recky of different locations in the US before the 9/11 can create pressure on MBS to again start selling oil for USD. The timing is so great as there always have been speculations that the Saudi government was involved in those terrorist attack. We will need to wait and see what happens next. I personally do not think that those declassified footage will create any kind of pressure on the Saudi government.

Thats too coincidence for this event and they already took the moneynfrom the Afghanistan government, mistakes of these intellegence are already branching out. If Saudi is indeed involved, is US going to go war with them?

Saudi is friends with Iran now which I think they are also looking for support from Russia or China. The war in Saudi will be worse than in Ukraine. The desert is always a good battle gound.

[pakhitheboss]

Thats too coincidence for this event and they already took the moneynfrom the Afghanistan government, mistakes of these intellegence are already branching out. If Saudi is indeed involved, is US going to go war with them?

Saudi is friends with Iran now which I think they are also looking for support from Russia or China. The war in Saudi will be worse than in Ukraine. The desert is always a good battle gound.

It is not just about petrodollars other things have come up recently that the US had to declassify those videos. The Saudi government is which is known as an ally of the US is planning to join the BRICS group. We already know which countries are part of the BRICS group and what kind of relation they have with the US. Such tactics are being used by the US the put pressure on MBS to stop taking decision which are not favourable for the US.

[Stompix]

Saudi is friends with Iran now which I think they are also looking for support from Russia or China.

Saudi Arabia hates Iran and Iran hates Saudia Arabia more than Russia does the US!
Just because they are both Muslim countries doesn't mean they are friends!
Same with Vietnam and China, you might think Vietnam is an ally of China, but surprise, it's not!

Also, again, a reminder, as long as Saudi Arabia sells oil in the currency which is pegged to the USD, oil is still traded in $.
It's like saying that when you deal with USDT or USDC you don't deal with USD!

How the USA will be reduced to a second-tier economy will be something exciting to watch though this can certainly affecting all of us as only a very few countries got no ties to USA economic behemoth.

How do you think the price of Bitcoin will react when the money flow in all those companies that invested in Bitcoin goes dry?
Imagine American investors dumping Bitcoin ETFs, dumping mining shares, dumping coins!
MtGox sold 2k coins and we dropped 10k, what happens when 2 million coins flood the market with nobody to buy back?

The US economy sneezed in 2007, the rest of the world nearly entered a coma, a serious collapse will send us back to the 30-40s!

[Sim_card]

US is the most powerful country and I don't think that  Suadi Arabia ending petrodollar will be the downfall of usd because that is the world reserve funds. In the international market goods are sold and prices in usd which will still strengthen the dollar. It is only if another currency becomes more valuable than USD that is when it will affect US economy. I believe the US will come up with strategies that will always strengthen their dollar to be number one in the market. Whoever wants to stop them, they will find a way to war that country.

[Wiwo]

US is the most powerful country and I don't think that  Suadi Arabia ending petrodollar will be the downfall of usd because that is the world reserve funds. In the international market goods are sold and prices in usd which will still strengthen the dollar. It is only if another currency becomes more valuable than USD that is when it will affect US economy. I believe the US will come up with strategies that will always strengthen their dollar to be number one in the market. Whoever wants to stop them, they will find a way to war that country.

Saudi Arabia ending a 80 years deal with the US is something that is long overdue because if the economy can nor create a sustainable alternative for it growth all the while in the last 80 years I will say that Saudi Arabia will have definitely failed in the economic growth and sustainability strategy so them ending the deal at this point will not affect both economy.

Let not even talk about the impact of this deal on the US economy because it won't have any at all and the USD is not losing it relevance in any ways since it still and will continue to remain the world trading currency even in years to come.