Syria switches to euro amid confrontation with US

[phantom power]

DAMASCUS (Reuters) -
Syria has switched all of the state's foreign currency transactions to euros from dollars amid a political confrontation with the United States, the head of state-owned Commercial Bank of Syria said on Monday.

"This is a precaution. We are talking about billions of dollars," Duraid Durgham told Reuters.

http://news.yahoo.com/s/nm/20060213/pl_nm/syria_us_forex_dc_2

[Viva_La_Revolution]

1. Does this mean Syria first, THEN Iran?

I mean, Iran's not planning on switching for a month, that gives us plenty of time to bomb the shit out of Syria, receive all the cheers and flowers, THEN go after Iran.

:scared:

[phantom power]

2. The question on my mind: is this intended as a veiled threat...

to move from petro-dollars into "petro-euros?" The act of decoupling oil from the US dollar would be a real weapon of mass destruction.

[fasttense]

3. I don't understand why it is such a big deal?

The European markets, for the most part, are doing just fine without their currency being coupled with oil. Why would it hurt the US so much?

[hadrons]

4. "Why would it hurt the US so much?" ...

our huge trade deficits I believe ... lower the demand for U.S. dollars means that interest rates would have to increase to get countries to invest in them

I think these are the reasons

[Viva_La_Revolution]

5. because our dollar would be 'un-coupled' from oil!

as it is now, if a country wants to buy oil, they first have to get dollars. If the rest of the world no longer bothers with dollars, they become worthless pieces of paper. The fact that they have had to use dollars for the last 5 years is the only thing that have kept our system from crashing completely.

It's very bad news, imho.

[FloridaPat]

6. Billions of dollars are stored to have liquidity when a country

buys or sells oil. If you need euros instead of dollars, they dump the dollars. We don't make much anymore, so there is no reason for dollars to be used for anything after oil. So the dollar does down against the euro. Which means everything we buy (almost) goes sky high because they are all made overseas. Read some stories about Germany right before WW2. To buy bread, they had to put money in wheelbarrows because the money was so worthless. It was cheaper to burn the money than to buy firewood.

[fasttense]

11. Thanks everyone for answering my question. n/t

[RaleighNCDUer]

8. Syria has no oil, so that's not it.

It's a precaution against US freezing Syrian assets in a coming conflict, IMO. No matter how much many here may scoff, they think it's going to happen.

[phantom power]

10. Sometimes even a currency switch is just a currency switch.

Freud said that, I think.

[happyslug]

13. Syria has oil, but not like the Persian Gulf

See the ASPO report on Syria:
http://www.peakoil.ie/newsletters/686

In 2002 Syria Exported 465,000 barrels of Oil per day (out of 506,00 Barrels of Oil Produced):
http://www.syrialive.net/financial/2002/021202Syrian%20oil%20exports%20to%20reach%20465,000%20bpd%20in%20February.htm

So Syria only used 41,000 Barrels of oil for its own use, thus it can export oil (As diminishing amounts) till the 2020s (Through this may be wrong see the Above ASPO report for details).

In November 2004, Syria production fell below 500,000 Barrels per day:
http://www.greencarcongress.com/2004/11/syrian_oil_prod.html

The Drop is believed to be do to a drop in local production. IT was claimed by some people that Syria was exported IRAQI oil while Saddam was in power, that fact that in November 2004 Syria was still able to export 500,000 Barrels of Oil a day indicates that the drop was NOT do to the loss of Iraqi illegal exports of oil, but a drop in Syria's own domestic production.

For Comparison Saudi Arabia produces 9.475 MILLION Barrels of oil per day:
http://www.cia.gov/cia/publications/factbook/geos/sa.html
i.e. Syria Production is only 5% of what Saudi Arabia Produces, but Syria still produces and exports oil.

[Viva_La_Revolution]

9. according to this, not a threat... a done deal

"has switched" not "threatening to switch"

wow.

[donsu]

7. this move to euro is important in fighting the bushmilhousegang

nt

[applegrove]

12. It is speeding up. Do neocons really think their ideas work?