Sergei Ryabkov, Russian Deputy Foreign Minister, stated the U.S.
dollar, Federal Reserve Note, was an enemy to Russia. He went on to proclaim
that Russia would be moving away from using the “world reserve currency” and
making other arrangements to conduct global trade.
Earlier Sergei Ryabkov said that it is important for Russia
to create a working economic system that would be less dependent on the US dollar and on the US
financial system as a whole. Otherwise, Ryabkov warned, the US will be
able keep Russia “on the hook, which is exactly what they (the US) want.” Source – Sputnik News
Now we see Russia making not just one move to improve their situation but
two major steps are either in place or moving toward the exit from the
Federal Reserve Note as unit of account for global trade settlement.
Meanwhile, Dmitry Polevoy, chief economist for Russia & CIS
region at ING Bank, warned
that the Russian economy may not be able to become independent
from the US dollar anytime soon due to the fact that Russia’s
status as major exporter of raw materials – for example, oil –
which is globally priced in US dollars.
“Therefore, a significant decrease in dependence on the
US dollar can only be achieved by increasing the volume of non-raw
material trade with the non-USD bloc countries,” Polevoy said. Source – Sputnik News
In April Russia moved $47.4 BILLION of their reported $96.1 BILLION of
U.S. Treasuries to someone else’s ledger sheet. It is not longer Russia’s
ball and chain. This represents approximately half of Russia’s holding in
U.S. debt. This would make anyone breathe a little easier as it has been said
in the past – if I owe you $100 that’s my problem, but I owe you $1,00,000
that’s your problem. Russia just dumped half of their problem.
In just one month, Russia proceeded to sell $47.4 billion out of the $96.1
billion the country had in US treasury bonds in March. The latest statistics released
by the US Treasury Department on Friday showed that, in April, Russia had
only $48.7bn in American assets, occupying 22nd place on the list of “major
foreign holders of Treasury securities.” Source – Russia-Insider
Then in early May 2018 we were following as the Russian’s were, once
again, making moves away from the U.S. dollar and discussing the Chinese
launch of the yuan priced futures oil contract.
Russia is ready to support the Chinese contracts, as Sputnik
contributor Igor Naumov wrote, citing a source close to the top
management of the Saint-Petersburg Stock Exchange (SPBEX).
“Currently, the US dollar is used as the contract currency
in the global hydrocarbon trading system, as well as for other
commodities,” the journalist explained. “This is what largely provides the
dollar with its status as the world’s leading reserve currency.
[However], the yuan is seeking to dislodge the American [petrodollar]
from one of the fastest growing oil markets in the world.”Source
And now in June 2018 we learned that Russia has been discussing a change
to the way oil is brought to market and, more importantly, how the pricing
mechanism is handled. The pace is quickening as Russia and other nations head
for the exit from the dollar based system. Is this the reason Russia is the
enemy here in the U.S.?
Russia and Saudi Arabia are using the backdrop of the FIFA World Cup,
being held in Russia, as the back drop for, what sounds like, a series of
meetings to hammer out details of developing a new global oil market. What
role the new futures oil contract priced in yuan, made available in March
2018 in China, is anyone’s guess. In my opinion it will serve as the backbone
of the discussions between Russia and Saudi Arabia.
Russia and Saudi Arabia have de facto accepted responsibility for the
stability of the global oil market by working out an agreement
which may pave the way for a new global oil market and oil price
regulation mechanisms, Russian analyst Dmitry Lekuh said. Source
Dmitry Lekuh noted that Russia and Saudi Arabia intend to offer
other oil producing countries — including Canada, Mexico, Kazakhstan and
the US – the opportunity to join the global oil production curbing
agreement.
Russian oil analyst, Dmitry Lekuh stated, as a follow on, that nations
from around the world including the U.S. Mexico, Kazakhstan and Canada
would be welcome to join this market but seemingly play no role in the
regulation, pricing or otherwise have anything to do with the workings of the
market itself, merely “customers” buying and selling in the market place.
This is two huge blows to the Federal Reserve Note, world reserve
currency, U.S. dollar and falls in line with Russia’s announcement of their
monetary system making dramatic changes to move away from the clutches of the
hegemonic U.S. dollar. Sounds like Russia, and several U.S. allies, can now
see the exit and are taking steps on a daily basis to simply walk away from
this unipolar system.
And finally, just earlier today from ZeroHedge we learn of the upcoming
OPEC meeting scheduled for later this week. The meeting doesn’t address any
of the real issues, like pricing, the impact of the yuan priced futures
contract or Russia and Saudi Arabia making moves away from the current system
nor will they be discussing Iran and Venezuela already out of the petrodollar
system. No, those are real issues and the masses are not allowed to better
understand what is actually happening. The masses only get the fluff and
“production increases/decreases” non issue.
Heading into Friday’s much anticipated OPEC meeting in Vienna, the focus
has shifted from (declining) global
demand-side concerns to specific supply-side actions, and while it is
broadly expected to conclude with an oil production increase – the
first since the historic production cut agreement in late 2016, is set to be
contentious with members Iran, Venezuela and Iraq arguing against a hike
proposed by Saudi Arabia and non-member Russia. Source – ZeroHedge
