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With the rise of BRICS it made me wonder what does it mean that countries may ask to pay for their oil in local currency instead of dollars. How does it all exactly work and who benefits from Brics countries are exploring how they can foster greater use of local currencies in their trade, instead of relying on a handful of major currencies, primarily the US The BRICS alliance inducted six new countries into the bloc during the 15th summit in Johannesburg in August this year. Five out of the six countries are leading oil In conclusion, it is unlikely that BRICS could demand the US and Europe to pay local currency for oil. The chances are that BRICS could lose bilateral trade deals with the BRICS demanding payment in local currencies would have serious geopolitical implications as it challenges dollar's status. It could impact US dollar's purchasing power and affect terms of So what could happen if BRICS asks the US and Europe to settle oil trade in local currencies and not the dollar? In this article, we will highlight what might happen if BRICS

What Happens If BRICS Asks US & Europe to Pay for Oil in Local Currency?

With the rise of BRICS, it made many wonder what it means when countries ask to pay for their oil in local currency instead of dollars. How does it all exactly work, and who benefits? BRICS countries are exploring how they can foster greater use of local currencies in their trade, instead of relying on a handful of major currencies, primarily the US dollar. The question on everyone's mind is: So what could happen if BRICS asks the US and Europe to settle oil trade in local currencies and not the dollar?

BRICS Expansion & the Oil Landscape

The BRICS alliance recently inducted six new countries into the bloc during the 15th summit in Johannesburg. Significantly, five out of these six countries are leading oil producers. This expansion strengthens the BRICS nations' influence in the global energy market and adds weight to discussions about alternative payment systems.

The Push for Local Currencies in Trade

BRICS nations are actively looking to move away from relying solely on the US dollar for international trade. The goal is to promote greater economic independence and reduce vulnerability to fluctuations in the dollar's value. This includes exploring the possibility of settling oil transactions in their own currencies.

What If BRICS Demands Local Currency for Oil from the US & Europe?

In this article, we will highlight what might happen if BRICS demands that the US and Europe pay for oil in local currencies. The implications are far-reaching and complex.

Potential Impacts:

  • Challenges to the Dollar's Status: BRICS demanding payment in local currencies would have serious geopolitical implications as it challenges the dollar's status as the world's reserve currency.
  • Impact on US Dollar Purchasing Power: A reduced reliance on the dollar for oil transactions could impact its purchasing power on the global market, potentially affecting terms of trade for the US.
  • Complexities in Implementation: Implementing such a system would require significant infrastructure and agreement on exchange rates, potentially creating friction in trade relationships.
  • Geopolitical Risks: The chances are that BRICS could lose bilateral trade deals with the US and Europe.

Conclusion: Is It Likely?

In conclusion, it is unlikely that BRICS could successfully demand that the US and Europe pay local currency for oil in the short term due to existing trade agreements and economic dependencies. However, the long-term trend suggests a gradual shift towards greater diversification in global trade and payment systems, and the rise of BRICS is a significant factor in this shift.

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