Will OPEC abandon the US$ in favour of the Euro € ?

Question

Several news carriers are tonight claiming OPEC members favour ditching the dollar for the euro. Has the falling US$ had its day?

Answer 1

I think it makes economic sense for theme to do so.
if the OPEC countries decide to change that currnecy then the dollar may recover but the US will no longer be the world's economic powerhouse.

If on the other hand OPEC were to decide to accept euros only for its oil (assuming for a moment it were allowed to make this decision), then American economic dominance would be over. Not only would Europe not need as many dollars anymore, but Japan which imports over 80% of its oil from the Middle East would think it wise to convert a large portion of its dollar assets to euro assets (Japan is the major subsidiser of the US because it holds so many dollar investments). The US on the other hand, being the world's largest oil importer would have to run a trade surplus to acquire euros. The conversion from trade deficit to trade surplus would have to be achieved at a time when its property and stock market prices were collapsing and its domestic supplies of oil and gas were contracting. It would be a very painful conversion.

The purely economic arguments for OPEC converting to the euro, at least for a while, seem very strong. The Euro-zone does not run a huge trade deficit nor is it heavily endebted to the rest of the world like the US and interest rates in the Euro-zone are also significantly higher.

Answer 2

i've been hearing that story for some time, the dollar i so weak and not getting any better that if i was an opec leader i expect i'd be voting to ditch the dollar in favour of the euro, i was told to expect the dollar to get a whole lot more weaker, the last exchange rate i've checked is $2.1:£1 and i've heard predictions of $2.5:£1, the euro is getting stronger still and i haven't seen figures to tell the rate other than pounds stirling, as i mainly trade in those 2 currencies

Answer 3

This is not today's news, it was suggested a while back to replace the USD with the Euro, looking how things are going in this country the we will be using the Euro as well once the Price of a gallon of Gasoline reached $5/Gal

Answer 4

You mean they haven't yet? Are they waiting for the dollar to become completely worthless?

There is no doubt that the dollar has become weak, but many other currencies are strong only in relation to the dollar. And China holds trillions of them, They might have some say in the matter.

Are they any currencies still backed by gold?
They might be good candidates.

Answer 5

I hope they do.

PS - I believe the mafia made the switch to the euro too - apparently it's much handier to make large cash payments in euro with the €500 note.

Answer 6

the end is nigh for the dollar, the chinese will dump the dollar too if Opec goes ahead....major problem for the USA

Answer 7

probably