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William R. Clark at ASPO USA 2006 Peak Oil Conference
Petrodollar Warfare author William R. Clark addresses 2006 ASPO USA conference held at Boston University. He works for John Hopkins Unversity.

The Silent War: Peak Oil and Petrodollars

Petrodollar Warfare author William R. Clark addresses 2006 ASPO USA Peak Oil Conference in Boston

By EV World

William Clark is the author of Petrodollar Warfare. EV World published his original essay in February 2003, which linked the war in Iraq with the growing sentiment that the dollar should not be the sole currency by which the world's oil is traded. In the intervening three years, he fleshed out that essay with more research and facts that lend strong credence to his hypothesis that there is a "silent war" raging that threatens United States economic hegemony.

Clearly pressed to squeeze a massive amount of information into a very short period of time, Clark lays the foundation for his belief that if the world eventually adapts a policy that allows oil to be traded exclusively in currencies other than the US dollar, it will have a profound and potentially disastrous impact on the economy of the United States, which uses the massive flow of trillions of petrodollars through the world's economic system to help shore up its trade account deficit.

He cites three trends to watch for that will signal this shift:

He referenced in his PowerPoint presentation a once-classified memo from the Treasury Secretary in the Carter Administration that indicated concern that Middle East confidence in the U.S. dollar was weak and that an OPEC proposal first to adapt a basket of five currencies and then three currencies against which to price oil was not in the interest of both the Saudis and the United States. The Saudis succeeded in killing the proposal within OPEC, but as a quid pro quo, Clark argues, the oil-rich kingdom saw its voting power with the IMF increase significantly.

Clark and other authors he quotes contend that the United States benefits from having oil and natural gas priced in dollars because it enables the country to maintain the liquidity of its currency, while exporting its inflation to other countries. It also protects the U.S. somewhat from oil price volatility, while allowing us to exercise significant control over the world's economy.

Most importantly, the flow of trillions of petrodollars, around the global subsidizes half of the U.S. current account deficit.

"That means we borrow $2.2 billion dollars a day, day after day," Clark stated. "Petrodollars are one billion of that." In effect, we're simply borrowing back our own currency.

The seriousness of the situation is underscored by a comment from an anonymous U.S. official who said that a shift away from the U.S. dollar as the world's reserve currency would be seen as "an unfriendly act."

You can listen to his entire 20-minute presentation using either of the two MP3 Players in the right-hand column or by downloading it to your computer for transfer to your favorite MP3 device. The URL is: http://www.evworld.com/evworld_audio/aspo06_wclark.mp3.

EV World expresses its appreciation to ASPO USA and the conference organizers for permitting us to record and videotape the 2006 conference.

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Times Article Viewed: 7982
Published: 05-Dec-2006

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