China to Use Gold for Purchase of Iranian Oil, Avoiding U.S. Financial Sanctions

http://www.algemeiner.com/2012/04/23...ial-sanctions/

April 23, 2012 9:45 am 0 comments
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Algemeiner Staff
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Chinese Premier Wen Jiabao. Photo: wiki commons.

As countries around the world and the banks that operate within them attempt to avoid American financial sanctions aimed at deterring Iran’s nuclear program – which blocks access to doing business in the United States for any entity that buys Iranian oil- Forbes reports this morning that China will look to buy the Iranian product using gold to circumvent Washington’s policy.
China is Iran’s largest trading partner and buys more petroleum from Iran than any other country. Already, China and India are bartering with Iran, using consumer goods, and in the case of India, the rupee, to pay for Iranian oil imports.
“Iran cannot stabilize the value of its currency with such unorthodox payment methods, and that is why its economy is collapsing,” Kenneth Katzman of the Congressional Research Service said in late March. “Iran is essentially on a junk-for-oil program.”
Iran has already said it will accept gold as payment for its oil in an attempt to prevent countries from stopping their purchases of Iranian petroleum altogether. China has already increased the amount of oil it imports from Saudi Arabia and other Persian Gulf states, according to the Forbes report.
As countries like India, Turkey, and China try to avoid American and European Union sanctions on Iranian oil by looking to other sources, U.S. Treasury Secretary Timothy Geinther spoke over the weekend about global supplies.
“Continued cooperation to ensure adequate supply will signal to global energy markets that there will be sufficient production available to meet demand,” he told members of the International Monetary Fund.

the beginning of the end of the petrodollar. Those sanctions really backfired...

No wonder why there are "p5+1" talks with Iran. What do they think? That Iran is suddenly going to go back to using the petrodollar? Yeah right!

It is doubtful that this decision will ever be reversed. More nations will buy OIL in gold, and gold will be how people conduct business in the future.

its not the end of the petrodollar, its just a loophole that china and iran can use against the sanctions.

It is the beginning of the end for the petrodollar as not only has China signed currency swaps with Saudi Arabia, Iran, and several other countries, but Iran has been leading an effort (even before sanctions) to not trade in the US dollar.

• Iran and Russia also have a currency swap agreement.

• China has made several currency swap agreements that effectively move the world away from the US dollar as the global reserve.

• BRIC (Brazil, Russia, India, and China) already conduct trade in their own currency which explains why they are becoming a very dominant power block within the world.

If they are smart, they might as well start a new United Nations because the current United Nations is useless and simply an outdated tool of Western hegomony- Western hegemony is breathing its last breaths as the Western economies have virtually collapsed in all but formal acceptance of the fact.