The U.S energy market is set to be threatened by a new idea from China.
The U.S are well known for their dealings in petrol and oil, and of their dominance in the market.
Evidence to suggest even that the Iraq war was started over a desire for oil shows just how serious they are about the stuff.
American ‘petro-dollars’ are important assets in the worldwide trading of fossil fuels, but they are set to be challenged by new so-called Chinese ‘petro-yuan‘.
China have announced this new currency as an attempt to knock the U.S off the top spot when it comes to importing and exporting petrol, something which will no doubt be a shock to the economy, and the America’s pride.
Contracts are said to be shifting into Chinese territory, thus creating an easier way for yuan to be converted into gold without involving any U.S dollars whatsoever, de-stabilizing the stock market.
Countries such as Russia and Iran will now be able to deal in petrol without having to deal with the U.S, and given current and recent relations between the countries it can be assumed that these new routes will be taken.
This point was elicited by Russian President Vladimir Putin almost two months ago during the BRICs summit in Xiamen:
“Russia shares the BRICS countries’ concerns over the unfairness of the global financial and economic architecture, which does not give due regard to the growing weight of the emerging economies.
We are ready to work together with our partners to promote international financial regulation reforms and to overcome the excessive domination of the limited number of reserve currencies.”
Renowned economist Carl Weinberg spoke to CNBC about the revelation, saying:
“I believe that yuan pricing of oil is coming and as soon as the Saudis move to accept it—as the Chinese will compel them to do—then the rest of the oil market will move along with them,” and “Moving oil trade out of dollars into yuan will take right now between $600 billion and $800 billion worth of transactions out of the dollar,”
The U.S have been looking over their shoulder at China for years now, wondering when they will make the push to be the new super-power and advancements such as this one make them look readier than ever.