Thursday, July 17, 2008

History of Oil in the Middle East from WWI to the Present: Iran Eliminates the U.S. Petrodollar

On Sunday 17 February 2008 the first phase of Iran's oil and petrochemical bourse on Kish Island was inaugurated, paving the way for “all major currencies of the world” to be used in future oil transactions. Two months later, on April 30, Iran announced that they had “totally removed U.S. dollars in the country's oil transactions.”

To understand the significance of these events let’s take a look back at our history, starting with World War I. The following short video (2:08) recaps the events that resulted in Britain landing troops in Iran in 1914, and consequently occupying Iraq. A more detailed and glorified recollection of this part of our history can be witnessed through one of the greatest epic movies of all time, ‘Lawrence of Arabia’.


We fast-forward to the first attempt of Middle Eastern countries to free themselves of Western control of their resources with Iran in 1951, when the democratically elected president, Dr. Mohammed Mosaddeq, nationalizated Iran's oil industry. Unfortunately however, Western powers would not stand idly by while Iranians took control of their own resources, which is why in 1953 the CIA, following instructions from Britain, organized a coup against Dr. Mosaddeq and overthrew the government. This was a well documented event and general knowledge among all those who lived in the Middle East and Asia for decades, but was not well known in the West until the year 2000 when the United States government released documents on the operation, and apologized to Iran and its people for the devastation that it unleashed. The following short video (4:39) is a good introduction to this topic.







Let’s now discuss the purchasing power of the US dollar.

Since the end of the Second World War, the US dollar has become the international reserve currency. The need for countries to maintain US dollar reserves was solidified in 1974 during the Nixon administration, when negotiations with Saudi Arabia assured that the oil would only be sold in US dollars, and surpluses from oil proceeds would be invested in U.S. Treasury Bills. In return the US would militarily and economically protect the Saudi regime. Since that time, US dollars have dominated world markets - until the year 2000 that is.

The following article, “The Real Reasons for the Upcoming War With Iraq”, which was written before the US invasion of Iraq, lays forth an argument that the war in Iraq was not just about oil but about the currency in which oil is traded. It is mandatory reading for anyone who wants to understand the basic concepts of American foreign policy, economics, and its military operations around the world. This article states that the principle reason why the United States invaded Iraq was because Saddam Hussein in the year 2000 went ahead with his plans to stop using the US dollar in its oil business and start using the Euro.

The trading of oil for the Euro instead of US dollars is an extremely important historical precedent set by Iraq that must be understood to fully grasp the implications of Iran's announcement in December of 2006 that they would “use Euro instead of US dollar in (their) next year's budget.” If the United states was willing to invade Iraq to prevent oil from being traded in any other currency than the dollar, then it would be logical to assume that they will also confront Iran regarding their plans to permanently and absolutely phase out the US dollar.

This now brings us full circle to the opening of Iran’s Oil Bourse and their announcement that they have “totally removed U.S. dollars in the country's oil transactions.” Since Saddam Hussein’s declaration that Iraq would begin to sell oil in other currencies, a few very significant events have taken place. Iran’s announcement that it would follow suit is just the tip of the iceberg. Many other countries have already started to sell the US dollar and to convert to other currencies. Some of these countries include: Sweden, Cuba, U.A.E., China, Russia, India, Indonesia, North Korea, Venezuela, and many more.

It is a fact that oil is the only reason the US dollar has maintained its value and acceptance as the world currency. Once countries can buy oil in non-US dollars then the complete collapse of the American Empire will occur.

All countries are aware that the US has been printing absurd amounts of their fiat currency, and they are no longer willing to hold reserves that continue to devalue. This devaluing has become accelerated since the discontinuance of the M3 report. “On March 23, 2006, the Board of Governors of the Federal Reserve System” ceased publishing the M3 monetary aggregate. The M numbers (M1, M2, and M3) are “components of the United States money supply”, which “show the amount of dollars in circulation”.
[Source: Vidz King - Posted by WAR ON YOU]

8 comments:

Mike said...

Was any of this information obtained from reading and/or listening to Lindsey Williams?

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