After Venezuela officially broke off with the US dollar, will the economy start to change from poor to rich, and many countries will follow suit?
According to a Reuters report on July 3, the United States has filed a lawsuit demanding the detention of four gasoline-powered tankers that Iran tried to ship to Venezuela. This is the latest attempt by the US authorities to increase economic pressure on Iran and Venezuela. However, Venezuela and Iran have indicated that they will not succumb to US pressure. The threat of US economic sanctions will not prevent Iran from continuing to supply gasoline to Venezuela.
Long ago, according to Russian media RT on June 22 Japan reported that Iran has sent the sixth crude oil-laden cargo ship to Venezuela, which will arrive at its destination on June 28, and just in May, a total of 5 oil tankers including the Iran Fortune have been delivered to Venezuela Approximately 1.53 million barrels of gasoline and related petrochemical equipment and preparations help support Venezuela’s oil industry and meet Venezuela’s domestic gasoline shortage demand for 2-3 months. Due to continued economic sanctions in the United States, most refineries have been shut down while Venezuela It is also impossible to import oil refining related equipment from abroad.
Because of this, the US’s continued restrictions and sanctions on the Venezuelan oil economy have caused the country’s fiscal revenue to shrink severely.
According to Reuters, the vessel tracking platform Refinitiv was cited on July 2 Eikon’s latest data shows that crude oil shipments from Venezuela, which is rich in oil resources, hit a new low, falling to its lowest level since 1943 in June, and Venezuela’s state-owned oil company PDVSA shipped about 379,000 barrels of crude oil and refined oil every day. The export has dropped by about 18%compared with a month ago. As the United States increased sanctions, WSJ reported last week that the US authorities are studying the possibility of imposing tougher new sanctions on Iran and Venezuela to stop Iran from Venezuela. Oil export.
At the same time, according to Russian media RT reported on July 3, tankers filled with Venezuelan oil are idling around the world because they cannot find buyers for their goods. It is believed that at least 18.1 million barrels of unsold oil (equivalent to Venezuela’s two-month production) are stuck on 16 tankers.
Iran’s tanker to Venezuela
Based on this, the latest news indicates that Venezuela has officially announced that it has made a break with the US dollar. At the same time, the country has even reached the frozen oil, the sale of gold and the right to withdraw, by issuing Petroleum coins. Although oil prices have been slowly recovering from the new coronavirus crisis in the past two months, and oil reserves are abundant, Venezuela is contributing a spectacle to the history of the world economy.
At present, Venezuela’s total economy has shrunk by 26.6%compared with 2017, and it has shrunk for six consecutive years. Oil and the US dollar are the two main reasons for Venezuela’s economy to return from rich to poor. Next, Venezuela is striving to win buyers of crude oil in search of economic reforms and new directions for its own oil.
Next, according to the Russian Satellite News Agency quoted President of Venezuela Maduro’s latest speech stated, “Once the new coronavirus epidemic situation permits, we will soon travel to Iran to sign relevant energy, finance, agriculture , Technology, science, and cooperation agreements and documents in the fields of health and pharmaceuticals.”
For this reason, Venezuela’s vice president in charge of the economy stated that the country’s oil trade will stop using the US dollar for settlement transactions and formally clear the US dollar from the exchange rate market. We note that although Venezuela’s dollar transactions are not convenient now, it still means that the country will officially abandon the dollar, and at the same time, another corresponding measure is to increase oil production.
Not only that, according to the Russian Satellite News Agency reported earlier It is said that the Venezuelan President has ordered the official settlement of oil in petroleum coins, and clearly stated that the goal is to convert all the country’s oil sales into petroleum coins, which also means that Venezuela has become the first domestic cryptocurrency to be supported by oil reserves. For countries that settle oil transactions, and hope that oil coins can break the dollar blockade, achieve wealth from poverty to wealth and get out of economic difficulties.
Venezuelan authorities recently announced that petroleum coins have been pre-sold by $3.3 billion. The Venezuelan central bank will receive $1 billion from the sale of petroleum coins. Venezuela is expected to issue a total of 100 million petroleum coins next. Each unit of oil coins is linked to a basket of oil prices. If calculated according to the official exchange rate of 55 dollars per barrel of oil agreed by the Venezuelan official, then the total value of these oil coins will exceed 5.5 billion US dollars. According to the official instructions of the Commission, this Virtual encryption digital currency can be used for saving, circulating and paying wages.
Even at a time when the global food supply chain is tense, the Venezuelan President issued a loan of 566,000 petrocoins to some companies engaged in grain production on TV shows to finance production with petrocoins. Currently, Venezuela Various customers, including Indian Oil Corporation, have been asked to pay for crude oil in petroleum coins.
In fact, Venezuela issues cryptocurrency petroleum coins or just The beginning, and their purpose is also very clear, through the use of cryptocurrency to simplify the transaction process or bypass the US dollar settlement restrictions, the Executive Secretary of the Venezuelan Blockchain Observation Center made a clear explanation. The country’s economic growth has an obvious effect because, as an encrypted sovereign digital currency endorsed by strategic resources, it cannot be prevented by the US bank clearing system.
We mentioned in last week’s report that following the launch of Venezuela’s petroleum currency, Iran has also announced that it will issue its own digital currency anchored in petroleum resources to circumvent the dollar restrictions. New news shows that Iran will Use cryptocurrencies to bypass US bank sanctions loopholes and use strategic resources such as crude oil and gold as physical mortgages.
This also means that Iran following Venezuela will become a country that uses its own cryptocurrency to settle oil transactions, and hopes that oil coins can break the dollar blockade. In other words, they are looking for another monetization outlet for their oil exports. Even two major powers will officially launch, suddenly announcing to follow the goal of decentralizing the US dollar using cryptocurrencies.
The latest development is that the relevant Iranian institutions are currently working with Germany, Switzerland, France, the United Kingdom and Russia are negotiating to carry out financial transactions in digital currencies, and behind this is that the economic sanctions of the United States have prompted profound changes in the way the two countries provide funds or sell crude oil to the country.
For example, according to Reuters, citing sources from the Ministry of Finance of Japan, officials of the Ministry of Finance and the Ministry of Finance also advocated the decentralization of the dollar in the field of commodity transactions with Iran, followed by , According to people familiar with the matter disclosed to the Yomiuri News two weeks ago that several Japanese banking giants plan to set up a committee for digital currencies, leading the establishment of an international network for cryptocurrency payments in the world, and with Iran including Many countries in the country have achieved decentralization in the oil and other fields.
In addition, Russia also announced that it will use bitcoin in December last year According to the Daily Telegraph, Vladislav Ginko, an economist at the Russian President’s National Institute of Economics and Public Administration, said that Russia will replace part of the U.S. dollar reserves with bitcoin and try to minimize the cost of oil and natural gas. The dollar-denominated payment flow may be restricted by interference, and the use of Bitcoin to support foreign exchange reserves may be launched as early as the second half of the year.
According to Russian media RT reported three weeks ago, the Russian authorities are studying the establishment of a digital currency system that uses gold as an anchor to support cross-border transactions, and progress has been made. Not only that, at present, there have been several countries that have announced the issuance of oil-like currencies (cryptocurrencies).
According to The National, UAE and Saudi Arabia have also announced Plan to create a joint cryptocurrency, which aims to simplify the payment method between the two countries, and earlier, on February 8 last year, Israel announced the issuance of a diamond-based cryptocurrency, followed closely by the Royal Mint In addition to its own cryptocurrency RMG with gold as a guarantee, before this, Turkey and Singapore also said that they have tried to develop their own cryptocurrency system. (End)