(The Economic Collapse Blog)—This month, rumors about the petrodollar have spread like wildfire all over the Internet. Some of what is being said is true, and some of what is being said is false. When other sources were reporting on “the death of the petrodollar”, I was asked why I was not writing about it. Well, the truth is that I was not writing about it because the petrodollar is not dead. It is certainly in trouble, but it is not dead. Today, most oil continues to be sold in U.S. dollars, and most global trade continues to be conducted in U.S. dollars. But that could change as other countries lose faith in our currency. In particular, we will want to carefully watch what the BRICS nations choose to do. 45 percent of the world’s inhabitants live in the BRICS nations, and they have been implementing strategies that are designed to promote their own currencies and reduce dependence on the U.S. dollar. As U.S. relations with leading BRICS nations continue to deteriorate, I would expect that trend to accelerate.
So I am not optimistic about the future of the petrodollar at all.
But what some other sources reported about the petrodollar earlier this month was simply not accurate.
Let me start at the beginning. According to Investopedia, petrodollars are “simply U.S. dollars accepted as payment by an oil exporter”…
Petrodollars are oil export revenues denominated in U.S. dollars. Petrodollars are not a distinct currency; they are simply U.S. dollars accepted as payment by an oil exporter.
Global crude oil exports averaged approximately 88.4 million barrels per day in 2020. That pace would generate annual global petrodollar supply of more than $3.2 trillion a year, assuming an average price of $100 per barrel.
Petrodollars are the primary source of revenue and wealth for many members of the Organization of Petroleum Exporting Countries (OPEC) as well as non-OPEC oil and gas exporters including Russia, Qatar, and Norway.
The fact that so many other countries all over the globe use the U.S. dollar to buy and sell oil is a major advantage to us.
Earlier this month, there was a flood of reports that the “50 year petrodollar agreement” between the United States and Saudi Arabia had expired and that the petrodollar was now dead.
But that wasn’t true.
As Peter C. Earle has accurately pointed out, there never was a formal treaty, there never was a formal expiration date, and Saudi Arabia has been trading oil for other currencies for a very long time…
Last week several reports suggested the termination of a US-Saudi petrodollar agreement, and speculated a Saudi Arabian move to sell oil on world markets in various currencies, including the Chinese yuan. The accounts were rife with inaccuracies: the Saudis’ have transacted in non-dollar currencies for decades, and there has never been a formal treaty, much less with a specified expiration date, governing the loose arrangement that has come to be called the ‘petrodollar system.’
Unfortunately, many of the false reports went viral, and Google searches for “petrodollar” spiked to unprecedented levels…
Almost immediately, Google searches for the term “petrodollar” spiked to the highest level on record dating back to 2004, according to Google Trends data.
But as speculation about an imminent end to the U.S. dollar’s global dominance intensified, several Wall Street and foreign-policy experts emerged to point out a fatal flaw in this logic: The agreement itself never existed.
At least, not in the way it was being described in the posts that had gone viral on social media.
This is why I take my time and do my research before I report something. It is so easy to be wrong, but it takes real work to develop a reputation for accuracy.
According to UBS Global Wealth Management chief economist Paul Donovan, the false story about the expiration of the petrodollar agreement “seems to have started in the crypto world”…
Paul Donovan, the chief economist at UBS Global Wealth Management, in a blog post said that the story had gained unexpected traction, serving as yet another example of the dangers of “confirmation bias.”
“The story seems to have started in the crypto world. Many crypto speculators desperately want to believe in the dollar’s demise,” said Donovan.
It is true that a “Joint Commission on Economic Cooperation” was established in 1974.
Originally it was only supposed to last for five years, but it was “repeatedly extended”…
The agreement referred to by Donovan is the United States-Saudi Arabian Joint Commission on Economic Cooperation. It was formally established on June 8, 1974, by a joint statement issued and signed by Henry Kissinger, the U.S. secretary of state at the time, and Prince Fahd, the second deputy prime minister (and later king and prime minister) of Saudi Arabia, according to a report found on the Government Accountability Office’s website.
The agreement, as initially envisioned, was intended to last five years, although it was repeatedly extended. The rationale for such a deal was pretty straightforward: Coming on the heels of the 1973 OPEC oil embargo, both the U.S. and Saudi Arabia were eager to flesh out a more formal arrangement that would ensure each side got more of what it wanted from the other.
At that time, the U.S. and Saudi Arabia very much needed one another.
Today, circumstances are quite different.
The U.S. is now much less dependent on foreign oil, and the Chinese have become one of the primary purchasers of oil from the Middle East.
Over time, more oil will be bought and sold in other currencies, but for the moment it is pretty much business as usual…
Oil has always traded in non-dollar currencies. In January 2023, Saudi indicated it was happy to negotiate oil sales in other currencies. The possibility changes little for financial markets. Saudi Arabia’s riyal remains pegged to the dollar, and its stock of financial assets are dollar focused. The dollar’s reserve status depends on how money is stored, not how transactions are denominated.
However, as I noted earlier in this article, we need to keep a very close eye on what the BRICS nations are doing.
Saudi Arabia has been deepening relationships with China, Russia and India, and that is definitely bad news for the U.S. dollar…
Owing to the US and Western Europe’s increasingly entangled alliances, and its own efforts to diversify away from dependence upon energy exports, Saudi Arabia has been increasing its diplomatic and economic engagements with China, Iran, Russia, nations considered primary US foreign policy adversaries. Recent moves toward accepting non-dollar currencies reflects broader geopolitical shifts away from US currency hegemony.
Of course the truth is that if we want to find the biggest enemy of the U.S. dollar all we need to do is to look at ourselves.
The rest of the world is rapidly losing faith in our currency because of what are own leaders are doing to it.
The U.S. dollar is no longer a stable currency. We are creating, borrowing and spending trillions upon trillions of dollars, and if we continue to act with such extreme irresponsibility everyone else will eventually be forced to switch to new reserve currencies.
According to USdebtclock.org, our national debt will hit 46 trillion dollars on this day in 2028 if we continue to borrow money at the rate we are right now.
That is madness.
We are literally committing economic suicide, but most of the U.S. population is not interested in such warnings.
They just want our leaders to keep flooding the system with more money so that the party can continue.
Yes, the party will continue for a little while longer, but once the lights are finally turned off nobody will ever be able to turn them back on again.
Michael’s new book entitled “Chaos” is available in paperback and for the Kindle on Amazon.com, and you can subscribe to his Substack newsletter at michaeltsnyder.substack.com.
Starting the Day With a Scripture-Inspired Roast Helps Center Your Thoughts on Eternal Truths Amid Temporal Pressures
The world can seem chaotic, especially right after we wake up. Many believers start their mornings reaching for something familiar — a hot cup of coffee — yet end up settling for mediocre brews that do little more than deliver a caffeine jolt. The daily grind of life, with its endless distractions, news cycles, and responsibilities, can leave even the most faithful feeling spiritually parched alongside their physical fatigue. What if your morning ritual could do more than wake you up? What if it could ground you in truth, nourish your body with exceptional quality, and quietly advance a kingdom purpose at the same time?
That’s the promise — and the reality — behind Promised Grounds Coffee. This Christian-founded company doesn’t just roast beans; it approaches every step as an act of worship and discipleship. By selecting only the top 10% of specialty-grade beans, ethically sourced from dedicated farmers in Central and South America, and small-batch roasting them with reverence in Austin, Texas, Promised Grounds delivers what many describe as the best coffee available — never burnt, never bland, but rich with origin stories and layered flavors that honor God’s creation.
From the vibrant Psalm 27 Roast (a light, bright medium option) to the bold yet peaceful 2 Timothy 1:7 Decaf, each bag carries a Scripture verse that turns your daily pour into a gentle reminder of faith. And through their Ounce Per Ounce Promise, every ounce of coffee you enjoy provides an equal ounce of clean water to families in need via partnership with Filter of Hope — literally brewing hope for body and soul, one cup at a time.
The challenge for today’s Christians runs deeper than finding a decent cup. In an age of convenience-driven consumerism, it’s easy to support companies that dilute values or remain silent on matters of faith. Many believers want their everyday choices — from what they drink to how they spend — to reflect discipleship rather than just convenience. Promised Grounds solves this by weaving Christian excellence into the entire process: beans nurtured with prayerful stewardship by farming families, roasted as an offering rather than a commodity, and packaged with Bible verses to encourage a mindset of gratitude and purpose from the first sip. Reviewers consistently praise the smooth, rich profiles — whether enjoyed black in a drip maker, iced on a warm day, or shared in fellowship — noting how the quality stands toe-to-toe with premium secular brands while delivering something far more meaningful.
This integration of faith and flavor addresses a real need in Christian households and ministries. Busy parents, church leaders, and remote workers alike report that starting the day with a Scripture-inspired roast helps center their thoughts on eternal truths amid temporal pressures. The coffee’s exceptional character — bright citrus notes in lighter roasts or deep chocolate undertones in bolder ones — comes from meticulous selection and careful roasting that respects the bean’s natural gifts rather than masking them. It’s the kind of coffee that elevates a simple quiet time, fuels productive workdays, or sparks meaningful conversations when shared at Bible studies or outreach events. And because it’s ethically sourced with integrity, every purchase supports sustainable livelihoods for farmers who treat their crops like family harvests.
For those leading churches or small groups, the impact multiplies. Promised Grounds offers bundles and options perfect for hospitality ministries, turning ordinary coffee service into an opportunity to point people toward the living water of Christ. Imagine greeting visitors with a warm cup whose very bag carries God’s Word — a subtle yet powerful witness that aligns with the Great Commission. The company’s Texas roots and commitment to “brewing hope” resonate especially with believers who value American enterprise paired with global compassion.
Of course, quality alone isn’t enough if the experience feels out of reach. Promised Grounds keeps it accessible with practical perks like free shipping on orders over $40, sample sets for discovering favorites, and thoughtful add-ons such as faith-themed mugs. Whether you prefer whole beans for fresh grinding, grounds for convenience, or even bulk options for larger households and ministries, the result is consistently superior coffee that makes discipleship feel integrated rather than added on.
As you consider how to align even the smallest habits with your walk with God, Promised Grounds Coffee stands out as a refreshing solution. It tackles the dual problems of subpar daily sustenance and disconnected consumption by offering a product that genuinely excels in taste while advancing a mission of clean water, farmer dignity, and scriptural encouragement. Believers who make the switch often describe it as more than a beverage upgrade — it becomes part of their rhythm of gratitude, a daily invitation to remember that every good gift comes from above.
If you’re ready to transform your mornings (and perhaps your church gatherings) with coffee that honors both exceptional craftsmanship and Christian values, I encourage you to explore what Promised Grounds has to offer. One sip at a time, you’ll be nourishing your body, refreshing your spirit, and participating in something far greater — all while enjoying what truly is among the best coffee available.
Michael,
What will be your reason for the world ending next week?