The petroyuan is seen as Beijing’s challenge to the US dollar, the dominant global currency in oil contract settlements.
The contract could reportedly be launched on March 26 on the Shanghai International Energy Exchange (INE). The exchange has recently received the approval from China’s State Council.
In December, the INE announced a successful completion of the fifth dry run in yuan-backed oil futures contract trading. It said that 149 of its members traded 647,930 lots in the rehearsal with a total value of 268.2 billion yuan. The exchange said the system met the listing requirements of crude futures after the exercise.
The Chinese government announced plans last year to start a crude oil futures contract priced in yuan and convertible into gold. The contract will enable the country’s trading partners to pay with gold or to convert yuan into gold without the necessity to keep money in Chinese assets or turn it into US dollars.
- Saudi Arabia Dumps United States ‘Petro-Dollar’ As Sole Oil Settlements.
- Russia Invests $14 Billion In Venezuela’s Orinoco Oil Fields & Gas Production
- Venezuela “Free Of The Rothschild Dollar Tyranny” Oil Priced In Chinese Yuan
- Iraqi Oil Surges 30% To China & 23% To India Surpassing Saudi Arabia As Fastest Growing Market
- Iraq’s Largest Oil Refinery Complex In Bayji Being Prepared To Be Placed Back Online: Iraqi Oil Sales Surges Surpassing Saudi Arabia As Fastest Growing Market
Since the 1970s, the global oil trade has almost entirely been conducted in US dollars. The largest energy consumer, China, is interested in having oil contracts in its own currency. Beijing wants to create an Asian crude oil benchmark that would better reflect pricing for the oil imported and consumed in the world’s top importing region Asia. It expects the new benchmark to rival North Sea Brent and US West Texas Intermediate.
Analysts say the success of the yuan oil futures contract depends on the Chinese regulation of the market, which could divert international investors from bringing huge volumes into the contract.
- Russian banks ready to switch off SWIFT – official
- Russia’s banking system has SWIFT alternative ready
- Russia To Cut Dependence On U.S. Dollar, Payment Systems
- Russia & China Met Twice Last Week to Propose Monetary Reset
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- China Becomes 2nd Biggest Importer Behind Turkey of Russian Food Products: Dumps U.S. GMO Corn
What’s At Stake?
The 1999 repeal of the original “Glass-Steagall Act” of 1933 was perhaps the single greatest criminal act committed against the economic welfare of the American people in the 20th Century. Despite all claims to the contrary, the repeal of Glass-Steagall laid the groundwork for the creation of a monstrous derivatives bubble which burst during the financial crisis of 2007-2008. Following that crash, the first act of Congress should have been to correct their folly by restoring Glass-Steagall, thus eliminating the massive bubble of gambling values and erecting a firewall between the uncontrolled speculation on Wall Street and the livelihood of the American people — precisely as Franklin Roosevelt did in 1933 when the Glass-Steagall Act was first enshrined into law. Instead, under the threats and intimidation of the largest financial institutions, Congress passed an unprecedented bailout of the Wall Street banks, on the backs of an already destitute American population. Over the subsequent eight years, our people have suffered the mounting effects of this fraud, to the point that our nation now faces another financial blowout of far-greater magnitude than even that of 2007-2008. The only means of avoiding such a fate is the immediate restoration of Glass-Steagall today as the necessary first step to a full FDR-style recovery program, as has been spelled out in detail by LaRouchePAC.
Glass-Steagall put properly, is not a federal regulation aimed at restraining the criminal temptations of an otherwise happy-go-lucky Wall Street. Glass-Steagall’s aim is to “throw the money changers out of the temple of our civilization”, once again, as President Franklin D. Roosevelt had the courage to do. It is not an adjustment within an otherwise operable system. Glass-Steagall is a revolution in national policy, a Declaration of Independence against an oppressive regime.
Glass-Steagall will not regulate Wall Street, but destroy it, and put it out of its misery, once and for all. America does not need Wall Street for its economy to grow any more than a tumor would be helpful to the growth of a man. The American Credit System, long advocated by Lyndon LaRouche, is the historical beacon with which finance the nation’s future. The cult of Wall Street—the system of finance characterized by increased rates of gambling, stealing, and fraud, has, once again, nearly destroyed the United States and therefore itself. Like a cancer, it must kill you in order for it to stay alive.
Just How Bad is it?
Estimates are that the current magnitude of outstanding derivatives claims accumulated as a product of speculative financial practices (read: gambling debts), now measures in the hundreds of trillions of dollars, perhaps reaching even to quadrillions. Even when compared to the current nominal global GDP, estimated at around $70 trillion, it becomes immediately apparent that this debt can never be paid. The vast majority of these outstanding claims are of a purely speculative character, with absolutely no connection to legitimate, necessary, productive economic activity. To continue to bail out this vast bubble of gambling obligations on the back of a collapsed and rapidly shrinking real economy, would be to create, rapidly, Weimar-style hyperinflation on a global scale, and an economic crisis of Dark Age proportions.
“The Triple Curve” was first presented by Mr. LaRouche at a conference at the Vatican in 1995. The version seen above is the third in a series, and functions as a heuristic device to describe the generalized collapse function of the world economy since 1971. The only way to stem the further collapse of the system is by using a Glass-Steagall standard to reorganize the transatlantic economy such that the monetary and financial aggregates of the economy conform to an increase in the physical economic input-output of the system, versus a decrease.
Glass-Steagall halts this catastrophe. By restoring the separation between commercial and investment banking, Glass-Steagall divides the obligations in question into two distinct and separate categories: legitimate and illegitimate, the latter being far greater than the former. Immediately, we declare that the government has no responsibility to pay back losses accrued through speculative activity, thus transferring these trillions in liabilities off of the government’s books. We force the megabanks—JP Morgan Chase, Citigroup, Morgan Stanley, etc.—to split themselves in two parts: the so-called “investment arms” on the one side, and plain, old-fashioned commercial banking on the other.
Under the original Glass-Steagall law, only commercial banks receive federal guarantees; “investment houses” do not enjoy such protection. Though their trillions in outstanding “assets” might not be explicitly cancelled or eliminated by law, we will simply declare that these debts are their own, their responsibility, and not the American people’s. Not one penny of bailout goes to pay them off, and, without this artificial protection, these assets will quickly dry up on their own. We as a nation are freed from this cancer, and our commercial banking system is restored to its necessary and indispensable function. This was the stated intention of Franklin Roosevelt’s original 1933 Glass-Steagall Act.