Monday, April 10, 2006

What happened to the Iranian Oil Bourse

This is taken from the subscription format of International Forecaster. I had raised a question about the Iranian Oil Bourse since I heard nothing. Here seems to be the answer.

Over the last year we have heard from many sources in detail how the Iranian Oil Bourse was in development and would be operational in late March. That time has come and gone and the bourse still doesn’t exist and there is no oil trade in euros. We have only seen one press release by the Iranian government and they played dumb saying there was never a plan to open such an exchange.

We have heard from our sources that such an exchange would be pursued by Russia. That could become a reality. We believe a deal was struck between the US and Iran. No bourse, and you stop conducting warfare in Iraq and we won’t nuclearize you. The US wants desperately to get out of Iraq and this move would go a long way to accomplishing that. Besides, we don’t believe the elitists want $2o0 oil at this time, which would result from an attack on Iran. Any thinking person knows that if such a bourse were opened it would eventually bring about the end of the US dollar as the world’s reserve currency.

A day after the Iranian Oil Bourse was supposed to open a Chinese news agency carried a story Qatar would establish an international energy bourse. Gulf Energy, a global consortium of energy consultants and investors had an agreement to begin such an exchange. The Qatar government said that the bourse is considered an important step in the country’s plan to become one of the largest liquefied gas exporters by 2010.

Then there is the idea that the euro didn’t have the reserve currency holdings nor the bond market to absorb such transactions. We pointed out that problem could be easily solved by the ECB and its members by buying gold. That would expand the reserve base and allow bond issuance and any increase on currency flow.

On the other hand, an oil bourse in euros would cause a shift away from the dollar, cause the dollar to fall in value, and eventually a dollar crisis would develop. The public and most professionals don’t really understand the derivatives market and such a switch in dollar holdings would force the Fed to create trillions more dollars so that the derivatives market wouldn’t collapse. All the machinations by the Bush administration in regard to Iran were a smokescreen. They had to stop such an exchange or see the end of the dollar as a reserve currency and the implosion of the world financial structure as the derivative markets came unglued. The need and possible mega need of massive currency injections is also part of the reason M3 was terminated. We should also add to the scenario that we feel the stock market is in serious trouble and soon the Fed via the repo pool and the Working Group on Financial Markets will have their hands full trying to keep the Dow from collapsing.

What has happened to the Iranian Bourse is that the US has convinced Iran that now is not the time to destroy the dollar. It is in the process of dying already so be patient and prepare yourself.


At Monday, August 4, 2008 at 10:05:00 PM GMT+1, Blogger notamobster said...

Ah, the oil Bourse. I wondered why it never took off, what with all the turmoil and the failing dollar and all... This is a very interesting supposition.


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