Petrocurrency

Petrocurrency (or petrodollar) is a word used with three distinct meanings, often confused:

  1. Dollars paid to oil-producing nations (petrodollar recycling)—a term invented in the 1970s meaning trading surpluses of oil-producing nations.
  2. Currencies of oil-producing nations which tend to rise in value against other currencies when the price of oil rises (and fall when it falls).
  3. Pricing of oil in US dollars: currencies used as a unit of account to price oil in the international market.
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