Other than desperate Russia, it is very unlikely that any oil export nation will accept yuan as final payment for their oil. They might accept Chinese goods priced in yuan in barter deals but very much doubt their bankers want to hold significant amounts of yuan as a reserve currency.
They don’t need to hold the Yuan as reserve currency to destroy the petrodollar.
All the Saudis need to do is refuse to honor the old Nixon agreement and accept non-dollars in payment, even if they only hold the Yuan for nanoseconds before converting it into any currencies they wish.
With the petrodollar gone the US inflation will explode when it comes to any foreign goods.
Nope, you don’t understand the dynamics. What made dollar attractive? It was apolitical. Now if you cancel the Russians from the financial system, why won’t you cancel someone else next? The Western system is no longer safe.
But countries that border China will look favorably at this. I can see I dis using Yuan; or the south Asian countries.
You and I both know that whatever gets people oil cheaper will win. And “cheaper” not not just the retail price. It’s the carry and transport cost. It’s the cost of debt. And it’s the benefit of Yuan reserves.
Just the fact that a large % of the traffic won’t require dollars means that those dollars are no longer “needed” in reserves. That causes the sale of dollars, and they come rushing back to the US.
THAT is what we are trying to avoid. If we cannot “force” markets to accept dollars, we cannot control interest rates or inflation.
This will happen slowly at first….and then it will be a logarithmic whirlwind.