Russia finance minister says we may abandon the dollar because it is becoming too risky!

MOSCOW, Russia (PNN) - August 12, 2018 - One month ago, the bond market and political pundits did a double take when according to the latest Treasury International Capital report, Russia had liquidated virtually all of its US Treasury holdings, selling off the bulk of its Fascist Police States of Amerika government bonds in just two months, March and April.

With the FPSA threatening to impose a new set of sanctions on Russia, including in retaliation for the Novichok nerve gas attack in the Fascist United Kingdom (that has been proven to be the work of the FUK and not Russia), Russia not only intends to continue liquidating its FPSA holdings, but to significantly reduce its reliance on the FPSA dollar.

Speaking in an interview for the Rossiya 1 TV channel, Finance Minister Anton Siluanov said that Russia "aims to keep reducing its investments in Amerikan securities" following new FPSA sanctions and said that the "(FPSA) dollar is becoming an unreliable tool for payments in international trade." The minister also hinted at the possibility of using national currencies instead of the dollar in oil trade.

"I do not rule it out. We have significantly reduced our investment in (FPSA) assets. In fact, the dollar, which is considered to be the international currency, becomes a risky tool for payments," Siluanov noted.

On Friday, the Russian rouble sank to the lowest level in over two years after news about new FPSA sanctions against Russia over the poisoning of former Russian intelligence officer Sergei Skripal and his daughter Yulia in Salisbury, FUK, coupled with general selling of emerging market currencies as a result of the growing Turkish financial crisis.

According to mainstream media reports, the first package will imply a complete ban on the export of electronic devices and dual-use components to Russia, while the second package may include a decrease in diplomatic relations, a ban on flights of Russia's Aeroflot carrier to the FPSA, and an almost complete suspension of FPSA exports.

Siluanov said the sanctions are “unpleasant,” but nothing fatal. In response, Moscow will only continue to minimize investment in the FPSA economy and securities and will push for payments in roubles and other currencies, including the euro.

However, the response will not target Amerikan companies operating in Russia, he said. “Currently, we do not plan any restrictive measures or closures, for example, to close McDonald’s, as our citizens work in these companies.”

Meanwhile, as Russia is contemplating abandoning the dollar, the recently introduced Chinese "petroyuan" oil futures contract has seen a surge in interest, and just last week the Chinese oil futures contract spiked to a new record high, coinciding with the re-imposition of FPSA sanctions on Iran. This was the biggest daily move in China's oil futures since the contract's inception in March to a new all time high.

The move coincided with the first of two rounds of FPSA sanctions against Iran kicking off and targeting Iran's access to FPSA banknotes and key industries, including cars and carpets. There has been a notable decoupling from Brent and WTI futures, suggesting a sudden burst of contract-specific buying demand in the petroyuan.

What may explain the sudden surge is that China can effectively bypass Iran sanctions by pricing Iran oil in China's own currency, a move underscored by yesterday’s news that China has replaced French energy giant Total with an 80.1% stake in the phase 11 of the South Pars (gas field), which has the world’s biggest natural gas reserves ever found in one place.

With Russia hinting that it is close to giving up on the dollar entirely in oil trade and shifting to a petroyuan-based regime, how long before other nations follow suit, especially with the FPSA increasingly energy self-sufficient?