If Oil were no longer priced in US Dollars and instead in Euros....?

Question

What would be the long-term effects on the US and World economies?

This is probably a question for someone with a degree, or at least who has taken some classes in world economics...

Answer 1

it would go up

Answer 2

I just watched CNN’s  international Channel(3pm EST), breaking  the news that oil price spikes again.  But the anchor and the reporter assert it is China’s diesel demand contributed to the hike.

Waited a sec !  It is already THIRD time I am hearing CNN’s assertion of China’s diesel demand. The first time was about two weeks ago. What’s going on?

Then, Israel’s-Iran-attack-drill news flashing back-------Which Was Just Happened This Morning !  That “unmistakable signal”  is surely an act to have a consequence of  oil supply disruption !  Why is it not reported as a oil spiking cause ? !

Time to scapegoat China again before a major offensive ? To verify, I went to CNN web site , there it is :

China hikes fuel prices http://money.cnn.com/2008/06/20/news/int...  

China to raise energy prices

http://money.cnn.com/2008/06/19/news/int...

But  nowhere saying that Israel’s-Iran-attack-drill  will unstablize the oil supply region, causing the oil  price up.

For Israelis Iran Strike Drill see

http://www.jpost.com/servlet/Satellite?c...

Answer 3

I haven't taken a class in global economics, but I can tell you some effects.

If less dollars are used (thanks to them being replaced), then the dollar will lose its value.  Less nations will use it and therefore the dollar will become low worth.  That would be terrible for the American economy.  Dollar being weak has already affected badly our economy.  With it being weakened more, it would cause more problems.  Inflation would hit and prices in the US would shoot through the roof a bunch more.

As for Euros, they would benefit European countries in a way.  More Euros used means that European countries using the currency would do well.  Euros' value would go up.  

I agree with another user, they would make oil prices go up.  Because more Euros are used, the demand for them is high.  As that happens, prices go up.  The Euro is already strong and it would get stronger.

Answer 4

If oil was priced in Euros instead of dollars, it would create massive demand for Euros. This would cause the Euro to increase in value, thus making Oil cost more.

At the same time, the US would see its currency weaken as less nations need the USD to obtain oil. And a declining dollar would curb our love affair with cheap goods from China. Although our exports would see a major pickup.