"Petrodollars" vrs. "Petroeuros" - Let's go back a few years...
...Back to when the establishment of the Euro was first being voted on.
If you go back & look real hard, there were just a few (I mean, a very few) thinkers who really put on their thinking caps and did some interesting speculation about "What If...", and specifically with the creation of the Euro as the international currency replacing the dollar for oil/petro based purchases.
Their overall conclusion seemed to be that this wouldn't necessarily be a good thing, certainly not for Europe as a whole. Their base logic was that such an occurrence would dramatically strengthen the Euro, but an unavoidable direct result would end up having to be a major transformation of a number of different European nation's governing structures, in particular economically related.
Logic being that in their viewpoint (can't find the material on the web, at the time these guys were looked at as being "way out there"...HA!), the Euro is by nature a "statist/evolutionary" currency, whereas the dollar is to a much greater degree a "activist/creative" currency. Both currencies represent the respective aspects of each society.
The EU is a substantial trading economy, but a strengthening national currency such as the Euro is not good for international trade. The stronger it gets, the more their trade markets become unfavorable. Making it the primary currency component for oil purchases (Petroeuro) does the EU no favors.
The EU economy is substantially based upon trade. But if their currency becomes so expensive (because of the demand for Petroeuros) that many parts of their trade market are unsustainable, what are they going to do to maintain their standards of living? Innovate?? New technologies and new growth markets? Develop new Entrepreneurial markets??
The "Thinkers" back then were very pessimistic over the EU's ability to adjust (not to adjust quickly, but just to adjust, period) to take into account a situation where the oil cartel has just hijacked the Euro, and in effect, turned the entire EU into their own currency exchange, while crippling the EU's main economic driver, which is their export markets.
And then they posed the big question. If this (then, unthinkable) situation really did occur, what would be the impact on the political structures in the different EU national governments, not to mention Brussels?
Cloudy and gloomy today, huh?
BBC provides an overview of the impact of oil prices around the world
From today's BBC
Quote:
The soaring cost of oil is causing growing strain to economies around the world, rich and poor.
With prices more than doubling in the past year to $135 a barrel, the impact is being felt acutely by consumers and businesses alike.
The risk of strikes and social unrest has become a reality in many countries as fuel becomes unaffordable for more people.
BBC reporters around the world examine the effects of the oil prices on their regions.
France offers fishermen aid deal
Again from today's BBC
Quote:
The fishermen's blockade began more than a week ago, and was originally confined to a few ports like La Rochelle on the west coast. But it spread until, on Wednesday, Calais, Boulogne and Dunkirk on the north coast, all serving cross-Channel ferry services to Britain, were isolated by a ring of fishing boats.
The stoppage forced UK authorities to shut the port of Dover, causing such a long build-up of lorry traffic that the M20 motorway had to be closed.
The fishermen say rapidly rising prices for diesel threaten them with bankruptcy. They are demanding a greater subsidy from the French government, in effect putting a cap on prices. But fishermen say that agreement is redundant, since fuel has become 30% more expensive since the start of the year.
Who's gonna work at all the fast food joints...
when the cost of a gallon of gas exceeds the hourly minimum wage?