The Rise of the 'Petro-yuan' and the Slow Erosion of Dollar Hegemony
By Flynt & Hillary Leverett
PostedDecember 2, 2014
Since 1974, the world has run on “petrodollars.” After the “oil shock” of ‘73–74, Nixon’s Secretary of State Henry Kissinger formed a deal that went like this: Saudi Arabia would price oil in U.S. dollars and use its clout to get other OPEC nations to do the same. In return, the U.S. government agreed to protect Saudi Arabia and its allies against foreign invaders and domestic rebellions. The agreement helped maintain U.S. dollar hegemony. Now, a new challenger is rising from the East…