Saudi Arabia has decided not to renew its 80-year petrodollar agreement with the United States, which expired on June 9, 2024[1][2][4][5]. This agreement, originally signed in 1974, established the US dollar as the world's reserve currency for oil transactions[3][5].

The crucial decision enables Saudi Arabia to sell oil and other goods in multiple currencies, including the Chinese RMB, Euros, Yen, and Yuan, instead of exclusively in US dollars[2][4]. This move signifies a major shift away from the petrodollar system and is anticipated to hasten the global shift away from the US dollar[2][4].

The petrodollar system has provided significant benefits to the US economy by ensuring continuous global demand for the dollar[1]. However, the decision by Saudi Arabia, along with the trend of countries reducing their dependence on the dollar, could mark the end of America's global financial dominance[5].

The consequences of this shift are yet to be fully understood, but it may lead to higher interest rates, more expensive mortgages, rents, loans, and potentially higher taxes in the US[5]. The value of the dollar itself could also be affected, making international purchases more expensive[5].

Sources [1] BRICS Officially END The Petrodollar: What next? - YouTube [2] Saudi Arabia's petro-dollar exit: A global finance paradigm shift https://www.tbsnews.net/world/global-economy/saudi-arabias-petro-dollar-exit-global-finance-paradigm-shift-875321 [3] Saudi Arabia Petro dollar : Saudi Arabia has recently abandoned ... https://www.cgwall.com/sports/saudi-arabia-petro-dollar-saudi-arabia-has-recently-abandoned-the-us-dollar/ [4] Saudi Arabia's petro-dollar exit: A global finance paradigm shift https://www.bizcommunity.com/article/saudi-arabias-petro-dollar-exit-a-global-finance-paradigm-shift-670911a [5] Saudi Arabia Just Ditched The U.S. Dollar - IslamiCity https://www.islamicity.org/101965/saudi-arabia-just-ditched-the-u-s-dollar/