[prottog]

> anyone who mentions the "petrodollar" in a geopolitical context knows knothing about geopolitics

I'm curious about this. The petrodollar is clearly a real phenomenon and policy decision. You might say that it's the replacement for when the dollar was backed by gold; instead of being convertible into gold, it's now the currency that's de facto required to purchase oil (which is basically liquid gold), as well as being the currency of the world's foremost military that protects the trade of oil.

[jcranmer]

What "petrodollar" refers to is the fact that oil producing countries (e.g., Saudi Arabia) have a vast surplus of oil revenue far in excess of their cost of production or ability to do anything internally useful with it. This means they have an extra stash of dollars that they need to do something with--and that stash of dollars is the petrodollar. It is a real phenomenon.

The problem is... it just doesn't have much relevance to geopolitics. The people who try to link it to such imagine that the US has a major foreign policy plank in upholding the use of dollars to price oil, to the point of starting wars purely to do so, despite such proponents not being able to offer a shred of evidence that any US official cared about this, or even being able to articulate what the supposed benefits the US receives from such pricing is.

[TMWNN]

Beyond what jcranmer wrote, if OPEC tomorrow priced oil in renminbi or rubles, China or Russia would be pleased because it would simplify transactions for them. But that decision isn't up to China or Russia; it's up to the various OPEC member states, who all want dollars and not Chinese or Russian funny money. And why should they do otherwise, when the Chinese and Russians themselves don't want their own currency, much preferring to hold dollars?