Over the past 10 days or so there have been two events engineered by President Trump which are threatening to tear apart the fabric of U.S. – European relations. And these events are the moving of the U.S. Embassy in Israel to Jerusalem, and the President tearing up the JCPOA (Iran Deal).
And while the first of these actions may end up simply spawning rhetorical outrage in Brussels or on the floor of the U.N., the second could be much more disastrous for Washington as European leaders appear ready to throw all caution to the wind by ignoring potential U.S. sanctions and change to purchasing oil from Iran in Euros.
This means in layman’s terms that Europe would be the next bloc to dump the Petrodollar.
The European Union is planning to switch from US dollars to euros when paying for the oil supplies from Iran, a diplomatic source told Sputnik.
On Tuesday, EU foreign policy chief Federica Mogherini said that after talks with the foreign ministers of the United Kingdom, France, Germany, and Iran in Brussels that the sides had agreed to work out practical solutions in response to the US withdrawal from the Joint Comprehensive Plan of Action (JCPOA), known as the Iran nuclear deal, within the next few weeks. In particular, the European Union and Iran would maintain and deepen economic ties, including in the area of oil and gas supplies. – Sputnik News
Buildup within the EU to reject U.S. hegemony over trade and foreign policies has already been going on for some time as the continent has lost hundreds of billions of euros cumulatively in trade by being willing to stand with Washington over sanctions impose upon Russia due to the Ukraine conflict. And now it appears that the final straw has been laid in Trump’s new decision to ditch the Iran Deal for something different as Europe relies too heavily on Iranian oil supplies to fuel their industry.
Discarding the JCPOA was pretty much the one red line that President Trump could not do in his foreign policy without the rest of the world standing up to the U.S. and in nearly one voice shouting ‘No’ to this decision. And with today’s announcement from EU sources that Europe is preparing to not only continue to buy oil from Iran, but do so in a currency other than the dollar, the threat to the Petrodollar just moved up another level, and one in which America can not afford to ignore for its own financial security.