Friday 2nd June, 2006 AD

FOLLOWING THE EURO FOR OIL STORY

Addressing the country on state television, Venezuela's Oil Minister 'Rafael Ramirez' didn't miss the opportunity this week to re-assure viewers of his county's intention to bypass the US wherever possible with their very strategic asset, "If a (oil) market in euros is created, with the euro as a reference, we could send our supplies there so they are sold under this currency. Iran has an initiative that we support," he finished. 

Without question, Oil is the king of commodities. In this modern world, no other commodity is more essential to the maintenance of 6 billion human lives. No other article of trade results in such large daily movement of money worldwide. 

For well over half a century now, the king of commodities has been denominated and bought & sold in United States dollars.

Selling Oil for Euro is no new concept. In former days it was Saddam Hussein that was particularly keen to set aside regional differences in an effort to stitch together a consortium of Middle East nations that would accept Euros as payment for their Oil. 

With Saddam off the scene, in 2004 Iran became the next to push the euro for oil barrow with their proposed Euro denominated 'Iranian Oil Bourse'. However, in March this year, its planned launch failed to materialize. Were Iran's plans for a Euro alternative shelved temporarily or 
permanently? - no-one really seamed to know. Admittedly Iran was now busy managing its nuclear stand-off with the West. 

Subsequently, oil dependent China, keen to sew up long-term supply contracts, announced that it would gladly pay for its oil with Euros. Russia was next cab off the rank, claiming it would back and supply its oil to any Euro denominated exchange. Then in early May, Iran popped 
back into picture when Iran's oil ministry reported that it had granted a 'license' for the creation of its much talked about euro-denominated exchange. 

Venezuela is probably the world's most outspoken opponent of the US. Comments from Rafael Ramirez this week was just throwing a little more fuel on the fire. 

In the past we have contended that future wars and struggles will center around both the supply of oil and the money that buys it. While the supremacy of the US dollar as the world's reserve currency is unlikely to change dramatically anytime soon, it certainly appears that there is a progressively growing undercurrent of change. 

As Individuals - our job is to equip ourselves with the knowledge that will help us survive and prosper in our changing world. At Daily Dig - our job is to dig up the relevant information that will provide you, our valued readers, with this knowledge.

Sincerely - Philip Judge pjudge@anglofareast.com