BRICS Dominates Global Oil in Crypto: A Stark Contrast to U.S. Ownership

Jonathan Stoker Feb 01, 2024, 09:45am 90 views

BRICS Dominates Global Oil in Crypto: A Stark Contrast to U.S. Ownership

Saudi Arabia's Entry into BRICS Alliance: A Power Shift in Global Oil Market

In a significant geopolitical development, Saudi Arabia has officially become a member of the BRICS alliance, marking the first instance of a major oil-producing nation joining the bloc. This strategic move by BRICS now allows them to control nearly 50% of the global oil output, potentially threatening US interests in the oil market.

US Dollar Under Threat as BRICS Gains Control of Oil Market

In light of Saudi Arabia's inclusion in BRICS, the alliance now oversees 47% of the world's oil, leaving the US with a mere 2.1% control. This development could have far-reaching implications on the US economy, particularly if BRICS starts conducting oil transactions in local currencies. The US dollar's position in the global market could be seriously jeopardized if this occurs.

Analysing the Oil Distribution Among BRICS Nations

With Saudi Arabia's entry into the alliance, understanding the distribution of oil control among the BRICS countries is crucial. As of now, the US dollar continues to be used for payment in oil transactions with developing nations. However, the likelihood of these countries adopting their local currencies for oil payments could increase, given BRICS' control over a significant portion of the world's oil.

BRICS' De-dollarization Process: A Challenge to the US Dollar

Despite the current use of the US dollar for oil payments, the risk of sidelining it remains high as BRICS has initiated the de-dollarization process. Saudi Arabia recently stated its readiness to accept local currencies from other developing nations for oil payments - a move that further threatens the US dollar's dominance.

US-Saudi Arabian Ties: Key to Protecting the US Dollar?

With the shifting dynamics of the global oil market, it is imperative for the US to formulate strategic initiatives and nurture its diplomatic ties with Saudi Arabia. The regional currencies, Saudi Riyal and UAE's Dirham, are tied to the US dollar, meaning any potential disruption to the US dollar could adversely affect their local economies.

Edited by Jonathan Stoker

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