Saudi Arabia's petrodollar deal with US expires with no new agreement in place
Oil price
A petrodollar agreement with the United States and Saudi Arabia has expired. As per reports, the Gulf nation has decided not to renew the deal thatexpired on June 9.
The move can be seen as a global finance paradigm shift from the USD as a reserve currency. The termination of the deal may also have implications and consequences for America.
The deal was a major milestone for the US global economic dominance. So far, there's no official confirmation to renew it.
The 50-year-old agreement has had significant geopolitical and economic implications. It acted as a catalyst in shaping the global energy market and influencing international relations.
The petrodollar system was signed in 1974 as a result of a bilateral agreement between the US and Saudi Arabia. Both nations decided to price and trade oil in US dollars.
)
The Royals enter the Doctor Who universe: King Charles and Queen Camilla beam into Commonwealth Games in TARDIS
)
Woman used AI to tell court what happened the night her ex-boyfriend 'raped' her. It was a bad idea
)
'First dumb AI': Meta AI blocks Indian PM Modi's video in his own country, allows abuse ads and deletes livelihoods without explanation
)
India avoids higher US tariff, secures lower 10% rate. Here's how
)
He predicted COVID-19 and 2008 economic crisis, was labeled fearmonger. Now he has another dire warning
)
Sadie Sink's leaked Spider-Man: Brand New Day clip fuels fresh Jean Grey speculation
)
'Nobody tells me what to sell': Trump rejects Netanyahu's objections to Turkey F-35 deal
)
ChatGPT invoked God, told pastor not to worry about his symptoms. Then pulmonary embolism hit
)
Rahul Gandhi slams BJP for felicitating Dharmendra Pradhan in Parliament, accuses Modi government of 'celebrating ruined futures'
)
'Islamic Republic will never make a deal with the US': Iran deputy speaker echoes Araghchi’s remark
)
NEET Protests riddled with misinformation? Delhi Police blocks 480 Pakistan-based handles spreading 'fake news' since Operation Sindoor
)
'Spreading deepfakes, deleted PM Modi's video': Why Meta AI should be banned in India for interfering in Indian economy and democracy
)
'Very unimpactful': Trump downplays Russian support for Iran, promises to 'ask Putin' about Zelensky's claims
)
Delhi Police issues BIG statement on viral 'don't leave national capital without permission' notice | FACT CHECK
)
Trump says Iranian school bombing photos could be AI-generated - 'I don’t think...'
)
China deploying advanced fighter jets closer to India's northern frontier
)
Who will benefit from Kapil Sibal's ₹1 crore legal aid fund for NEET protesters? This is what we know
)
Giant iceberg flips violently near Greenland exposing its underside - 'I didn't know they could do that'
)
Assam floods: Over 4.45 lakh affected across six districts; 631 villages inundated, Charaideo worst-hit
)
'Worst quality AI in market': Meta AI's moderation fail hits PM Modi and Indian Democracy
)
‘Kill Melania, Barron’: Why is IRGC-linked media outlet urging ‘freedom fighters’ to assassinate Trump’s family? WATCH
)
CWG 2026: India enter top 10 with six medals on day 5 of Glasgow games
)
'Broader struggle for democracy...': Greta Thunberg joins Indian students protest in London - What she said
)
Russia-Ukraine War: Russia drops 3-tonne Glide bombs on Ukraine
)
NEET aspirant ends her life in Maharashtra after falling 11 marks short of cut-off
)
Netanyahu to present Trump with fresh intel on Iran's SECRET 'Pickaxe Mountain' nuclear site: Report
)
'Not in our DNA': Iran denies seeking US negotiations, rejects Trump's remarks
)
3,000 years ago, humanity spoke thousands of languages — then fell silent. Where did they all go?
&im=FitAndFill=(700,400))
Why the specialized paint on an S-400 costs thousands of dollars per truck
)
Jennifer Lopez's ex-husband Ojani Noa claims he confronted Sean 'Diddy' Combs over alleged affair
With oil standardised in terms of dollars, every country purchasing oil from Saudi Arabia would be required to pay in dollars. Several other oil-producing countries also began to standardise their oil pricing in US dollars, which gave push to the petrodollar system.
Watch:G7 Summit 2024: Summit to tackle issues from wars in Ukraine, West Asia to China
In return, the US provided military support and security guarantees to the Saudi, ensuring its stability and protection against external threats. Meanwhile, Saudi agreed to invest its oil revenues in US assets, primarily Treasury securities, which helped finance US deficits and stabilise the dollar.
The six‐page agreement was signedat Blair House across the street from the White Houseby then US Secretary of State Kissinger and Prince Fand Ibn Abdel Aziz, wholater became king of Saudi Arabia.
At the time of the deal, Kissinger had said, "We consider this a milestone in our relations with Saudi Arabia and with the Arab countries in general."
The crucial decision to not renew the contract enables Saudi Arabia to sell oil and other goods in multiple currencies, including the Chinese RMB, Euros, Yen, and Yuan .
(With inputs from agencies)