“It actually is a big thing”
Help us understand why that is so.
As I see it (limited view), oil is simply a currency benchmark for the US dollar.
Payments are made in multiple currencies, but pricing is in dollars.
How does pricing in another currency affect us?
No, it’s paid for in dollars.
So, countries need to exchange euros for dollars for transfer.
That means the US can control the “value” of the dollar through interest rates and inflation control.
When the oil market is available for purchase in other currencies, countries that trade in that currency dont have to convert to buy oil. Therefore, the banks do t have to hold as many dollars—as they don’t gain you much sitting in a vault (in US treasuries.)
Those banks would sell their dollars, driving up the interest rates. And since the US would have less control over the supply…that interest rate could be sharp.
It means internally, we would be fine. But imports would become very expensive. And we import EVERYTHING.
That is an “explain like I am 5 years old” view of this. There are a lot of other things that complicate it.
But this is what happens when you insult another world leader over and over and over. It gets personal. This is the KSS’s way of saying FJB.