The End of Petrodollar Era? How Trump’s Iran Deal Undermines the Dollar – bY SPUTNIK

On May 14, Reuters reported that Washington’s decision to re-impose sanctions on Iran had bolstered investor interest in trading crude in yuan instead of US dollars.

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A cashier displays multiple denomination US dollar and British pound Sterling bank notes

People attend the launch ceremony of Shanghai crude oil futures at the Shanghai International Energy Exchange (INE) in Shanghai, China March 26, 2018

However, the launch of the first-ever yuan-denominated oil futures on the Shanghai International Energy Exchange by China on March 26 and the global role of euro could serve as a game changer upsetting Trump’s plan.On May 14, Reuters reported that Washington’s decision to re-impose sanctions on Iran had bolstered investor interest in trading crude in yuan instead of US dollars. As a result, Shanghai crude oil futures ISCc1 have seen a steady rise in trading reaching a record 250,000 lots on May 9, a day after Trump’s pullout from the JCPOA.

The crux of the matter is that the yuan-denominated transactions are non-transparent for US financial regulators, the economist pointed out, assuming that Chinese and European consumers could use Shanghai as a “black box” to evade US sanctions while buying Iranian crude.  

According to Irina Fyodorova, a senior researcher at the Institute of Oriental Studies of the Russian Academy of Sciences (RAS), China has experience circumventing…

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