Transnational Thursday is a thread for people to discuss international news, foreign policy or international relations history. Feel free as well to drop in with coverage of countries you’re interested in, talk about ongoing dynamics like the wars in Israel or Ukraine, or even just whatever you’re reading.
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Notes -
I considered putting this in the Culture War thread but decided it fit better here. US Saudi "petrodollar" pact ends after 50 years.
One of the reasons, if not the main reason, the US Dollar is the world's reserve currency is that OPEC agreed to index the value of oil in US Treasury bonds. That agreement is a big part of how the US has managed to ring up only modest national debt despite sizeable budget deficits, and has a been significant factor in maintaining "Pax-Americana". It seems to me that the State Department and the Senate both allowed the agreement to expire with little (if any) effort put into negotiating an extension or consideration for the implications.
To my lay-person's eyes this looks like it should be a big deal but it also seems to have been completely ignored by all the big name news sources outside NASDAQ and the WSJ. Are media moguls trying to bury the story or am i just being paranoid?
It does seem interesting. What remains to be seen is to what extent the Saudis will actually start pricing or selling at least some oil in currencies other than USD, and whether the US will be less committed to defending the current Saudi regime.
Presumably they would? My loose understanding is that the Saudis would likely start developing their own nuclear deterrent without the US defending them, and the US is pretty keen on avoiding nuclear proliferation.
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