A.I.M. Users Bulletin Board

[ls7550]

Less than 0.1 USD/US gallon in Venezuela (subsidised)

https://www.globalpetrolprices.com/Venezuela/gasoline_prices/

Much the same here in the UK, around USD10/US gallon. IIRC 85% of which is taxation and contributes around 10% to national tax revenues. So if they reduced the tax for the relief of drivers they'd have to extract additional taxes from elsewhere. Could be a wise move given the knock on inflationary effect that the cost of transport has upon broader inflation.

Cutting off the largest land mass natural resources producer (wheat/oil/gas from Russia) seems more of a self harm action. After the 2014 Crimea sanctions Russian dealings in USD reduced from 90% down to 45% when they agreed with the BRIC's (Brazil, Russia, India, China) along with their African activities to trade in non-USD. Collectively around two thirds of the world population moving away from trading in USD. Clearance such as SWIFT relies upon upward through US and back down again transition, giving the US the power to cut off transactions - which isn't going down well and is inducing a move away from that structure to non-USD based alternatives.

What oil/gas Russia doesn't export to Europe, China's rising demand will likely more than offset. So seems to me that sanctions will just see USD based trading countries seeing high/rising inflation whilst Russia will just shrugs its shoulders at sanctions.

Part of the deal that ended the gold standard and the USD taking its place was that the US pledged to act responsibly, promises that were subsequently broken. A trickle of movement away from trading in USD could soon turn into a torrent, preventing the US capacity to export inflation (print/buy whatever it desired), leaving it much more accountable. I would imagine that the next primary trading currency will be some kind of Dixie like choice, based on a basket of currencies. Others say it might be something like bitcoin but my understanding is that the technical limitation of bitcoin can't handle anywhere near the volumes/speeds involved.

Clive