Posted on 03/17/2008 9:47:05 AM PDT by BGHater
CARACAS (AFP) - Venezuelan state oil giant PDVSA has decided to sign some oil contracts in euros in the face of a plummeting dollar, local media reported, citing officials.
"There are some contracts in euros, contracts for crude, products and spot markets in euros. This is a subject which we are working on," said energy minister and Petroleos de Venezuela (PDVSA) chief, Rafael Ramirez, in an interview with the journal El Universal published Friday.
It remained unclear which oil sales would require payment in euros.
Venezuela, Latin America's leading petroleum producer, has previously backed Iran's proposals for OPEC to abandon the dollar and use the euro for oil pricing. But the Organisation of Petroleum Exporting Countries has rejected the idea, at least in the short-term.
The head of the journal Petroleum World, Elio Ohep, said the shift to euros was "good business" for Venezuela.
"PDVSA always had an interest to negotiate in dollars because the company had refineries in the United States and needed cash but currently with the euro rising, it is taking in more dollars and (Venezuelan) bolivars," he said.
The dollar hit new lows this week against the euro and yen, with the euro at 1.5669 dollars at 21000 GMT on Friday.
Venezuela produces 3.3 million barrels of oil a day, according to official figures, and 2.4 million according to the International Energy Agency. Half of its production is sold to the United States market.
No, the IEA doesn't claim that.
http://www.iea.org/textbase/nppdf/free/2007/key_stats_2007.pdf
The show Venezuela producing 151 Million Tons per year.
151 Million Tons of oil equals about 1,107 Million barrels or 3.03 Million Barrels per day.
Probably a good sign that the dollar has bottomed and is getting ready to bounce.
CHavez just painted a huge target on his forehead.
Maybe this will help to finally eliminate home country currencys. What would the problem with eliminating the dollar, euro, and ALL other existing currencys and going with a universal currency used by the whole world?
The Fed is not pushing a strong dollar at all. It will slide some more. Best case would be not less than 50 against the euro.
Why not? It has been beaten down pretty hard. Problems in America means problems for everyone. Eventually things will turn around and the US will come out better than our European counterparts.
That had occurred to me recently. Any one care to explain why this would be horrible to have a single currecny throughout the world?
you’re kidding right? If not the problem with that is that I’m not a citizen of the whole world and I don’t want to be because I don’t want to be paying taxes to the whole world and I don’t want the whole world passing legislation affecting me and my rights without my being represented before the whole world which I’m not.
If there were only a single world currency, there would be zero exchange-rate flexibility — floating exchange rates are best able to respond to changes in real-world economic conditions.
The economies of different nations grow (or shrink) at different rates. If their respective currencies exchange rates don't adjust — something else has got to give.
Consider the recent decline in the U.S. dollar (as a Canadian, I know all about declining dollars). The lower exchange rate means that imports into the U.S. cost more, and exports cost less — therefore the lower dollar will reduce the balance of payments deficit.
The lower dollar also means that U.S. workers are being paid less (in terms of imported goods and services). Can you imagine actually cutting people's paycheck by the same amount? It simply wouldn't happen — or if it did, there would be delays and turmoil.
As the fable of the oak tree and the reeds illustrates — flexible things bend with the “winds of change”, inflexible things are eventually broken and knocked down.
Maybe that’s why the price of oil is plummeting today
Be sure to note the age of the article.
In further muddying of the waters, OPEC reports Venezuela Production to be 2.4 MMBPD.
http://www.opec.org/home/Monthly%20Oil%20Market%20Reports/2008/pdf/MR032008.pdf
See Page 33
It looks like IEA has some conflicting statistics. I wish they would not report in MMBPD in some reports and Million tons in others.
http://omrpublic.iea.org/opecsupplyresults.asp?opeccountry=Venezuela&opecformat=%25&Submit=Submit
Five years ago, could you imagine being able to say that oil “plummeted down” to only $103 per barrel?
Natural gas off 75 cents. Imagine that when natural gas was 2.50.
The Europeans were able to balance their respective country’s debt to be able to adopt the Euro.
Whom would you care to put in charge of this universal currency? The UN?
As bad as the Fed is behaving currently, it’s possible to make things a lot worse (Zimbabwe, for example). As moronic as the Fed is currently acting, some one-world bureaucracy would be an even greater disaster.
Whom would you care to put in charge of this universal currency? The UN?
As moronic as the Fed is currently acting, some one-world bureaucracy would be an even greater disaster.
(I think I pasted my earlier edit into my post somehow. Apologies for the redundancy.)
A one-world currency would require a one-world superbank to govern and oversee it—meaning, something like the UN would act like the Fed.
I would not consider that an improvement; and I doubt it would ever set policies that would be beneficial to America.
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