This weekend, Saudi Arabia and several major oil producers, including Russia, the United Arab Emirates (UAE), Iraq, Kuwait, Oman and Algeria, plan to cut oil production (https://news.bitcoin.com/saudi-arabia-and-opec-reveal-surprise-oil-production-cut-white-house-insists-cuts-arent-advisable-right-now/) by a total of 1.15 million barrels per day.
Saudi Arabia and Russia announced that each country will cut oil production by 500,000 bpd, while the UAE will cut production by 144,000 bpd and Kuwait will cut production by 128,000 bpd.
The announcement of the oil superpowers' decision to cut supplies followed cuts made in October, when oil-producing nations announced production cuts of 2 million bpd. At the time, the Biden administration expressed its anger and warned of "consequences."
On Sunday, the White House also reacted to the surprise cuts, with a spokesman for Biden's National Security Council saying the United States did not believe the production cuts were appropriate.
The spokesman also said the Biden administration would continue to work with oil producers to keep gasoline prices low for U.S. fuel consumers. This news followed reports? indicating that several major countries are refusing to settle in U.S. dollars.
According to Alexander Babakov, deputy chairman of the State Duma, the BRICS countries (Brazil, Russia, India, China and South Africa) are planning to discuss creating a new reserve currency for the group. In addition, China recently concluded a bilateral deal with Brazil that allows for the purchase of liquefied natural gas (LNG) in national currencies (mostly RMB).
The BRICS bloc is now the world's largest group by gross domestic product (GDP). Saudi Arabia and other major oil producers believe that production cuts will help stabilize the oil market and are being implemented as a "precautionary measure," according to the Riyadh Energy Agency.
The data indicate that despite the production cuts in October, Brent and other crude oil prices have fallen from $95 a barrel to $80 a barrel. Last October, when OPEC cut production by 2 million bpd, Democratic politicians wanted to cut ties with Saudi Arabia, withdraw troops from the region and stop arms sales.
It should also be said that this is another and far from the last call for the U.S. dollar to lose its status as the world's reserve currency. This could happen faster than financial analysts think. Once the BRICS single reserve currency is announced, the dollar will effectively cease to be the world's reserve currency, leading to a collapse in its price relative to the yuan, gold, silver, oil and a range of commodities.
The largest consumers of oil and resources in the EU and Eurasia will be confronted with the fact of the need to transfer all payments for energy resources in a new reserve currency, which may become one of the foreign trade contours of the digital yuan. All preparatory work has already been completed to launch this project.
Over the past year, transactions in the oil and gas market in U.S. dollars have been decreasing weekly; in the coming months, a critical volume of these transactions will actually shift to renminbi. And it is this moment that will be decisive for the collapse of the dollar.
U.S. financial authorities understand this and are keeping their hand on the pulse. They are not ready to accept the loss of confidence in the U.S. dollar as the world's reserve currency as a reason for the crisis, and will try to arrange a global banking crisis synchronously with the introduction of the international digital yuan. According to calculations by banking analysts, the coming banking crisis will lead to the fact that in the U.S. will remain only 6 banks, mostly owned by JPMorgan group. The remaining 4,700 banks will be absorbed or go bankrupt.