Petrodollar decline?

Macro Perspectives

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In my election day note back in 2020, I said this: "the stakes are extremely high in this election. China is on the verge of supplanting the United States as the world's economic superpower, and they will not seek to spread democracy; instead, they have a clear and explicitly stated goal of world dominance."

Trump had been a wrecking ball for the Chinese Communist Party’s grand plan. And with that, it’s safe to say they would do anything and everything to get rid of him. 

Here we are, and America (the global hegemony) is now leading a high-risk global economic and social transformation plan for the Western world, which has resulted in eroding influence and sovereignty. Meanwhile, China has been strengthening itself on both fronts.

Moreover, in the past two weeks, China has brokered a deal between the Saudi's and Iran and strengthened ties with/influence over Russia.

So, the Western world is purging itself of one of the world's most important resources (oil, which plays a vital role in national security and prosperity) - and China has, not only stockpiled oil at cheap prices through the global pandemic period, but has now strengthened its access.

It appears increasingly likely that China will be buying oil from these oil-rich countries, with yuan, not dollars.

This is a huge deal.

The "petrodollar" has been the cornerstone of the dollar's role as the "world's reserve currency." The United States' position as an economic superpower has relied heavily on its status as a world reserve currency.

Anti-oil policies of the Biden administration are the equivalent of taking a shotgun to one's own foot.

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