The US pressed sanctions on Venezuela in 2018 and banned its state-run oil company PDVSA from exporting to its chosen markets. Under pressure to lift its economy amid sanctions, Venezuela announced in May that it plans to completely end reliance on the US dollar and no longer use the currency for any global trade. Venezuela is following in the footsteps of BRICS to lift its native economy by ending dependency on the US dollar.
Read here to know how many sectors in the US could be affected if BRICS completely stops using the dollar. The move could send the US economy on a downward trajectory with uncontrolled inflation and job losses across America.
Also Read: 39 Countries Ready To Join BRICS in 2024
BRICS: Venezuela Threatens To Stop Using the US Dollar, Now White House Eases Sanctions
A handful of developing countries are gaining inspiration from BRICS and abandoning the US dollar for global trade. Developing countries are advancing to strengthen their native economies and local currencies by ditching the US dollar. Venezuela revealed early this year that they are considering to stop using the US dollar for economic transactions, as they are sanctioned.
In a sudden turn of events, the US eased sanctions on Venezuela and relaxed oil trade, allowing them to produce and export oil to their previous customers. The US relaxed oil sanctions allowing Venezuela to settle payments in the US dollar without restrictions for six months.
The majority of oil from Venezuela will move to China and Spain and can settle trade using the US dollar. BRICS member India is also a large market for Venezuela and both the countries will exchange the US dollar for payments.
India remains uncomfortable using the Chinese Yuan for oil trade and could welcome Venezuela’s oil by paying the USD. Bloomberg reported that India is unhappy to ditch the US dollar for oil as the Chinese Yuan benefits from the ordeal. Now that the US eased sanctions on Venezuela, payments in the dollar could slightly rise in the next six months.