Shamia N Irving Friday, February 8, 2008 3:57pm
Organization of the Petroleum Exporting Countries (OPEC) is made up of 12 countries that produce oil in order for it to be sold to other nations such as the United States of America. The chief of this organization is heavily contemplating having the oil priced in Euros. This choice will lessen the US dollar. The chief says that it will take approximately a decade before this change is actually completely made. Middle Eastern sentiment has been slowly turning away from the U.S. dollar in part because of a 21.8% rise in the euro against the U.S. currency over the past two years. Many of the nations that are apart of OPEC including Qatar and Saudi Arabia, have openly pondered abandoning USD pegs. Iran already prices most of its oil in euros. The chief El-Badri said “It took two world wars and more than 50 years for the dollar to become the dominant currency. Now we are seeing another strong currency coming into the [frame], which is the euro,”
What does this mean for us as consumers? If the chief does decide to price oil using euros the US will have to purchase oil using more money, which means that oil refineries will probably charge more and the government will increase the taxes on the oil because they too will want to receive more money if the producers are receiving more money. We as consumers will have to pay more money because the US as a whole will have to give more money in order for us to receive the oil.
http://www.economicnews.ca/login.php?page=reportsDetails&newsid=50186&prevview=&view=details&country=Europe&plimit=0&category=European%20Economic%20Reports
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