China Buys Iran Oil in Yuan; Saudi's Big Gift; Petro-Dollar Fades

It can truly be said that when the times change, all forces align, and the heroes of the past are not free.

As everyone is immersed in the discussion of how China's visit to three European countries will affect China-Europe relations, a different voice is heard from the Middle East.

It's not just that the Israeli-Palestinian conflict is even more intractable, but also that Saudi Arabia, the mainstay of petrodollars, has issued a major announcement that it will cooperate with China on challenging issues.

Is Saudi Arabia about to abandon the petrodollar?

Is the foundation of the dollar hegemony to be completely uprooted?

Saudi Arabia has given a big gift to the world, which is in tatters, while China is mending and patching.

When the United States issued the most severe threat to China's European trip, it did not expect that its own backyard was on fire, and even its foundation might be loosened as a result.

Recently, according to reports from the Economic Observer Network, Thamer AlSuliman, the Deputy Minister of Investment of Saudi Arabia, stated during his participation in the Hong Kong and Saudi Capital Markets Forum that the importance of China is gradually becoming prominent.

Saudi Arabia hopes to not only strengthen industrial cooperation with China but also to strengthen capital cooperation.

He also said that they will cooperate with China on challenging issues.

It can be said that this challenging issue is very credible.

At the same time, the country is also planning to buy oil with local currency.

It should be noted that Saudi Arabia is now one of the BRICS members.

And when the BRICS expanded last year, countries like Brazil advocated for de-dollarization, using other currencies or local currencies for settlement to dilute the presence of the dollar.

Earlier this year, Egypt also made the same call, and it can be said that de-dollarization has become a trend.

Some may wonder, Saudi Arabia did not mention the settlement in RMB, so what's the good news for us?

Although it was not mentioned, the absence of the dollar is already very important for us.

Replacing the dollar is not so easy, is it?

It should be known that Saudi Arabia has been hesitating on the issue of petrodollars, and the biggest reason is Saudi Arabia's concern for the future, so Saudi Arabia has always been moving forward in small steps.

The vanguard is the UAE, a younger brother of Saudi Arabia.

It should be noted that the UAE carried out the first trade of natural gas settled in RMB with PetroChina Singapore last year.

It can be said that this is symbolic.

It should be known that a transaction is not simply a matter of exchanging money for goods, but requires a systematic process.

This process was previously designed to serve the settlement of the dollar.

The famous settlement system SWIFT is the key, so to complete the large-scale settlement of RMB, the first step is to run through this system.

In addition to the UAE's trial settlement, there was also a piece of news that China once provided RMB loans to Saudi Arabia for trade settlement.

It should be known that who is the richest in the world, with a piece of cloth on the head.

Saudi Arabia dares to say the third, no one dares to say the first.

Saudi Arabia alone earns nearly tens of billions of dollars in profits from Saudi Aramco every year, and the Saudi Investment Fund has assets of trillions of dollars.

At this time, borrowing RMB from China is definitely not because Saudi Arabia is short of money.

It should be more that Saudi Arabia wants to try whether the RMB settlement channel is unobstructed.

After all, China has always imported more oil and other resources from Saudi Arabia than exported trade to Saudi Arabia, which has caused Saudi Arabia to earn dollars, but not RMB.

If you want to spend RMB, you have to borrow.

From loans to settlements, and then to investments, it can be said that this is a huge systemic project.

And Thamer also said that by 2030, Saudi Arabia's investment plan will be $32,000, and China will be its investment focus in the future.

At the same time as Saudi Arabia said it would discuss challenging issues with China, China also welcomed an important guest, that is, the Pakistani Foreign Minister is about to visit China.

Many people may wonder, what is the relationship between Pakistan's visit to China and Saudi Arabia?

In fact, Pakistan has always been known as the bodyguard of Saudi Arabia, and many of China and Saudi Arabia's cooperation projects have gradually landed in Pakistan.

Therefore, the petrodollar is replaced by security, and now the bodyguard provides security, so the next step is worth imagining.

The loss of the petrodollar is like a wall collapsing and everyone pushing, and a broken drum is beaten by thousands of people.

Today, the United States is facing a situation of collapse.

Japan and South Korea are taking action, Europe is preparing, and now even the Middle East is accelerating, and the petrodollar may be accelerated to the end.

The development of history has never been linear, but has a leaping nature.

If many people go back to 2017, I guess no one would think that the world's lighthouse would be in such a situation.

And it should be known that when everyone realizes that the dollar hegemony is about to end, the first thing they all do is to run away quickly, after all, a gentleman does not stand under a dangerous wall.

Now we see that France has expressed its intention to strengthen cooperation with China, and at the same time, France has expressed that it will consider more for its own interests.

The cooperation between Saudi Arabia and China on challenging issues this time is aimed at one point, that is, to gradually transfer more of Saudi Arabia's investments from the West to the East.

We must know that in the past, the focus of Saudi Arabia's investment has always been in the West.

On the one hand, Western investment has a high return rate, and on the other hand, how can you let the United States trust you if you do not invest in the West.

Saudi Arabia's investment in the West is actually more like a "hostage" left in the West.

In exchange for the trust of Europe and the United States.

Now that it is going to part ways with the United States, the first step must be the transfer of assets.

This is not exactly the same as Russia's operation before the conflict between Russia and Ukraine, but it can only be said to be not much different.

And in the past two years, Saudi Arabia has earned huge trade surpluses.

Just in 2023, Saudi Arabia's profits reached about tens of billions of dollars, but Saudi Arabia did not increase its holdings of U.S. debt, and even declined.

This means that the speed of Saudi Arabia's asset transfer is very fast.

At the same time, as Saudi Arabia increases its investment in China, Saudi Arabia also invites Chinese enterprises to participate in the Saudi 2030 Vision project.

This in and out, will the trade settlement be all in dollars?

It should be known that buying oil needs to be settled in dollars, but it is not fixed that Saudi Arabia needs to use dollars to buy China's service industry.

Can it be settled by accounting, and finally offset by oil or completed by borrowing RMB?

And we all know that when China and Saudi Arabia signed the relevant agreement, they mentioned a time point at that time, that is, to gradually implement local currency settlement and so on within 3-5 years, so all of this is being carried out in an orderly manner.

In addition, another phenomenon that has gradually appeared recently is that the European Union and Japan and South Korea, which have always been in sync with the United States, have also started to make small moves.

Japan secretly sells U.S. debt and buys yen to dig the corner of the dollar.

And Europe is more direct, saying that it will start to cut interest rates in June.

Even the rebellious Sweden has cut interest rates by 25 basis points, running directly, and ignoring the United States' orders.

It can be said that the United States has gradually become a lonely person.

Even if the Federal Reserve comes out with various positions, the United States will maintain high interest rates or raise interest rates, it cannot curb the decline of the dollar.

Perhaps now is the highlight of the dollar in the future, and it will also be the last highlight of the United States.

The final game between China and the United States, a gentleman does not stand under a dangerous wall, the future of the petrodollar has already been doomed, and for us, it is better to accelerate the establishment of a new system to get rid of the influence of the dollar.

Now we see that although the United States is still struggling, the U.S. high-level continues to shout for the dollar, but the trend of history has formed, and the dollar has long been yesterday's yellow flower.

Some people may say here, the United States is still harvesting, and the world is working hard to resist the dollar tide, why say that the dollar is already tomorrow's yellow flower?

Because now the dollar tide is like the United States wants to kick Russia out of SWIFT, it looks like a financial nuclear bomb, but how much power can it land?

And recently, according to relevant media reports, the mortgage interest rate in the United States has now reached about 7.22%, and this has already exceeded the highest value since November 2023.

Even the Federal Reserve has warned that the overdue situation of commercial real estate in the United States has reached the level before the epidemic.

This means that the United States has already been unable to support it, and it is more about hard resistance or verbal resistance.

From cutting interest rates to not cutting interest rates, and then to rumors of raising interest rates.

It can be said that what the Federal Reserve plans is probably not clear itself.

But it can be very clear to see one point, that is, the probability of the United States not being able to bear it is getting bigger and bigger.

And other major economies have not had too many waves, as for Japan's rapid devaluation, it can only be said that Japan is special, after all, no one will do it except Japan, holding a large amount of foreign exchange reserves, and finally being starved to death.

So, the current game between China and the United States, seemingly a game between China and the United States, is actually a game between two worlds.

China's European trip this time also shows one point, that is, even the brothers of the United States who are not born from the same father and mother have started to betray the United States.

Coupled with Saudi Arabia's rapid follow-up, and China's recent large-scale sale of U.S. debt and purchase of gold.

All of this is indicating that the changes in the world are accelerating.

At the same time, China, as Iran's largest oil importer, also ensures the stability of the situation in the Middle East with an annual volume of tens of millions of tons.

Recently, the United States' intervention in the Israeli-Palestinian conflict seems to have not achieved the expected effect, so what will happen next may also be a very key point.

And this will completely change the situation of the United States in the Middle East, and the collapse of the petrodollar may also be greatly accelerated.