In the wake of dollar depreciation, the OPEC is facing revenue losses and depletion in forex reserves. In the following interview, Karin Kneissl, a well-known Lecturer, focuses on benefits of decoupling dollar and adopting euro or other appreciating currencies into their portfolio.

There are various positions voiced inside OPEC which now comprises 13 member-states. Talking to the economists within the OPEC General Secretariat based in Vienna one is often confronted with the following position: Oil is a globally-traded commodity and the markers of its pricing system such as Brent, WTI, etc., are all denominated in dollar in the international oil market. Considering the whole system of oil trading and hedging being built around the dollar, there appears little chance of change.

However, watching some of the OPEC countries such as Kuwait which has shifted to a currency basket or Iran where according to international news wires of December 8, the dollar has been eliminated from oil sales, we can see divergent approaches to the subject. There is not one cohesive position on how to deal with a highly-inflated dollar. Some countries such as the United Arab Emirates wish to invest their huge dollar reserves, by turning into major shareholders of US banks, for instance.

Others for economic or political reasons, like Venezuela, tend to take more populist decisions and do their utmost to move away from the dollar. This latter action is not always beneficial either. If a common position should be agreed upon, its impact could go beyond the global oil market and affect commodity trading by and large.

Treasury Management Magazine, Organization of Petroleum Exporting Countries, OPEC, Dollar Depreciation, International Oil Market, Global Financial Markets, Monetary Policy, Economists, Karin Kneissl, Business Environment, Business Strategy.