SEARCH BLOG: OIL
There has been speculation for years that the dollar would eventually be abandoned as the pricing unit for oil. CNN says... maybe not.
Oil has risen 5 times higher in the period that the dollar has fallen 50% versus the Euro according to CNN. That's still a lot of price increase... even in Euros.
"The dollar is like the Microsoft Windows of the oil world," said Tertzakian. "It's just hard to switch out of it."
And even if OPEC did switch its oil pricing to another currency, some doubt whether the dollar would really take a hit.
The amount of oil OPEC sells on the world market is somewhere around $1.5 billion per day, said Jeffrey Currie, the head of commodity research at Goldman Sachs in London.
Compare that, he said, to the more than $3 trillion that change hands in currency markets every day."You're talking about a value that's just too small to show up on the radar screen," said Currie. "It isn't enough to materially change the currency markets."
Nevertheless, becoming a larger consumer/debtor nation versus a producer/creditor nation seems to be having one obvious drawback.Sure it's not just oil. Oil just reflects the results of trying to get a "free lunch" from certain trading partners... among other issues.