Putin, Xi, and Modi Meet : BRICs vs. Petro-Dollar Currency – Ep.1

(Feat. Russia Vladimir Putin, China Xi Jinping, India Narendra Modi, Saudi Arabia, UAE Oil Money; UK – Iran BP, SWIFT, CIPS and the USA)

On October 22, 2024, the BRICS Summit will kick off in Kazan, Russia, gathering world leaders including Russia Vladimir Putin, China Xi Jinping, and India Narendra Modi. Here’s a breakdown of the relationships at play:

1. BRICS was coined by Goldman Sachs economist Jim O’Neill in 2001.

2. It stands for the most emerging economies of Brazil, Russia, India, and China.

3. In 2010, South Africa joined, turning “BRIC” into “BRICS.”

4. The “S” represents South Africa, making BRICS a group of five nations.

5. At first, BRICS wasn’t a big deal.

6. In 2001, these countries made up only 8% of the world’s GDP.

7. But now after 23 years, BRICS accounts for 37% of global GDP, showing their impressive growth.

8. Jim O’Neill predicted BRICS could dominate the world economy by 2050.

9. Together, BRICS nations represent 42% of the global population—about 3.2 billion people.

10. BRICS continues to expand its influence.

11. In 2023, it added Egypt, Ethiopia, Iran, UAE, and Saudi Arabia.

12. More nations like Algeria, Indonesia, and Türkiye(Turkey) are also applying.

13. Argentina was set to join BRICS in January 2024, but a new president withdrew the plan.

14. Despite Argentina’s exit, BRICS might still grow to 20 countries, representing 60% of the global population.

15. Russia and China lead efforts to create a common currency within BRICS.

16. In June 2022, at the BRICS Forum in Beijing, Putin proposed creating a BRICS-based international currency.

17. Putin’s idea challenges the dominance of the U.S. dollar, aiming to disrupt the current global financial order.

18. Xi Jinping supported Putin’s proposal and criticized the U.S. shortly afterward.

19. Their well-coordinated speeches revealed their strong collaboration.

20. Putin’s plan involves a three-phase approach to establish this new currency.

21. The first step is using yuan, not dollars, for trade among BRICS nations.

22. In April 2nd 2023, China, Russia, and Brazil agreed to implement this plan.

23. In early 2023, Brazil had already agreed with China to use their own currencies for trade.

24. When they say “own currencies,” they essentially mean using yuan for settlements.

25. BRICS will also use China’s CIPS platform for payments instead of SWIFT.

26. Though this doesn’t directly challenge the petrodollar system, it’s a significant move.

27. To understand the significance of using the yuan, you need to know the history of the petrodollar.

28. In 1973, U.S. diplomat Henry Kissinger met with Saudi King Faisal to make a critical deal.

29. The U.S. would protect Saudi Arabia militarily, and in return, Saudi would sell oil exclusively in dollars.

30. This deal created the petrodollar (petroleum + dollar) system, making the dollar the world’s dominant oil currency.

31. Oil-producing countries used their dollars to buy U.S. Treasury bonds.

32. This created a self-sustaining loop: dollars from oil sales supported the U.S. economy.

33. That same year, the U.S. developed the SWIFT system for international financial transfers.

34. SWIFT standardized dollar payments for oil, and over 12,000 banks in 200 countries joined.

35. Iran’s tensions with the West are largely tied to the petrodollar.

36. In 1901, Britain secured a 60-year contract for Iranian oil development.

37. By 1909, the British-Iranian Oil Company, later BP, was born.

38. British Navy leader Winston Churchill saw oil’s strategic value and pushed for government control of BP.

39. BP became Britain’s primary oil company.

40. The British government paid 16% of the oil profits to Iran as royalties.

41. After World War II, Iran demanded renegotiations, seeking a better share of the oil profits from the UK.

42. Iran felt it was unfair that, despite the oil being extracted from their land, Britain was taking 84% of the profits.

43. As U.S. oil companies split profits with Venezuela and Saudi Arabia, Iran wanted the same deal.

44. U.S. companies could offset their tax losses by paying oil royalties, something Britain couldn’t afford – as U.S. companies had significantly more financial resources.

45. Britain needed to maximize its profits from Iranian oil.

46. In 1949, Iranian Prime Minister Mossadegh promised to nationalize oil.

47. In April 1951, Mossadegh carried out his promise, nationalizing Iran’s oil industry—not by splitting profits 50-50, but by taking full control, 100% of the oil revenues going to Iran.

48. Britain responded by preparing to use military force to regain control.

49. The U.S., focused on the Cold War, didn’t want Iran to fall under Soviet influence.

50. The U.S. feared that if Iran became communist, the entire Middle East, including Saudi Arabia, which accounted for two-thirds of the world’s oil supply, could fall under Soviet USSR control.

51. Yet, going to war with the Soviets over Iran seemed too risky for the U.S.

52. At that time, the U.S. was in the early stages of a military buildup, and it calculated that by the end of 1952, its military strength would would be sufficient to fight the Soviets USSR in a full-scale war if necessary.

53. Until then, the U.S. sought diplomatic solutions.

54. Britain, however, wanted to take back control of Iranian oil by force.

55. The U.S. first tried to mediate between Britain and Iran.

56. However, Mossadegh’s strong resolve made a peaceful resolution impossible.

57. In September 1951, Mossadegh expelled British oil workers from Iran.

58. Britain retaliated by blocking Iran’s oil exports and setting up a naval blockade.

59. British Prime Minister Churchill planned to deploy 70,000 troops to retake Iran’s oil fields.

60. By 1952, the U.S. saw Mossadegh as the main obstacle to peace.

61. The U.S. shifted its focus from mediation to regime change – by eliminating Mossagdegh.

62. By November 1952, a covert U.S. operation called NSC-136/1 was approved.

63. The plan involved toppling Mossadegh with help from the British.

64. Operation Ajax, a covert joint CIA-British coup, followed.

65. On August 20, 1953, Mossadegh was overthrown by a military coup.

66. This paved the way for the pro-American Pahlavi dynasty.

67. U.S. and British interests controlled Iranian oil, and Iran adopted a pro-Western stance.

68. When the Shah exiled religious leader Ayatollah Khomeini, protests erupted.

69. The Shah fled Iran, and a revolutionary government took over.

70. When the U.S. allowed the exiled Shah into the country, Iranian students stormed the U.S. Embassy in Tehran.

71. Fifty-two Americans were held hostage for 444 days.

72. In 1981, they were freed after the U.S. agreed to return the Shah’s wealth to Iran.

73. In 2005, one of the hostage-takers, Mahmoud Ahmadinejad, became Iran’s president.

74. Ahmadinejad launched an anti-American agenda and established an Iranian oil exchange on the island of Kish in the Persian Gulf.

75. Iran began accepting euros and rials, rather than dollars, for oil, challenging the petrodollar system.

76. The U.S. responded with economic sanctions, banning Iran from using SWIFT.

77. However, cutting Iran off from SWIFT had unintended consequences.

To be Continued in Episode 2.

Alphazen Insight

BRICS is shaking up the global financial game. With Putin, Xi, and Modi at the forefront, they’re targeting the petrodollar system—the backbone of global oil trade. Bringing in heavy hitters like Saudi Arabia and Iran, BRICS is serious about moving away from the U.S. dollar and pushing for yuan-based oil transactions. This is no small feat—it’s a direct challenge to decades of U.S. economic dominance.

As BRICS expands its influence, the next phase might be even more disruptive. In Episode 2, we’ll dive into how cryptoand digital currencies could further weaken the dollar’s grip. And in Episode 3, we’ll explore India’s balancing act between BRICS and its Western ties.

Stay tuned—this revolution is just getting started!