A Shower of Bankers

Long term readers of this blog probably remember me getting my knickers in quite a twist this time last year about the Iranian Oil Bourse, a venue for trading oil and petrochemicals well outside of America’s sphere of influence and in currencies other than the dollar. At the time, I thought it certain to bring the dollar and the U.S. hegemony crashing down, and the “real” reason for Bush’s warmongering.

With all that’s happened since then, perhaps it’s best to see the emergence of the IOB – and other significant institutions like the Shanghai Cooperation Organization and the Banco Del Sur – as a reflection of America’s decline as well as a contributing factor. Still, I hope you’ll all be interested to learn that after many delays it finally came into operation yesterday. You can find plenty of interesting links on the subject at EnergyBulletin.net.

By a happy coincidence, this came just one day before the ruthlessly neoliberal New Labour government finally conceded that Northern Rock is now (“temporarily”) nationalised.

Pimpin’ Ain’t Easy

That the wars in the Middle East are about oil politics is pretty much trivial, but it’s misleading to think of the U.S. primarily as an oil consumer. It could so easily have bullied Saddam into a corner, but instead it has created an anarchy that pushes oil prices ever higher, not lower. Some use this as evidence that it’s actually nothing to do with oil (though to me it smacks of Goldfinger), but that’s because the U.S. is not so much an oil consumer as an oil pimp, and nothing enrages it more than when the oil whores start to act independently.

Since the 1970s, all oil transactions are made in US dollars, and the US thus gets a tasty slice of everyone else’s oil pie (I’m mixing metaphors here or it could soon get nasty). In 2000, Saddam Hussein declared that Iraq would henceforth be selling its oil in Euros (despite its then being weaker than the dollar). By 2001, George W. Bush was desperately looking for an excuse to bomb Iraq. Slap her around nicely, and give the others something to think about.

Then Iran got cocky. In 2005, it decided to launch the Iranian Oil Bourse, an Internet-based stock exchange for trading fossil fuels in non-dollar currencies. It’s still not ready, and unless Pimpin’ Uncle Sam has really lost his touch, it never will be.

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