BRUSSELS/LONDON (Reuters) – The European Union has convened a wide-ranging industrial group to work on promoting the euro and fighting the monopoly of the U.S. dollar in oil and commodities trading, reflecting broader tensions with Washington over trade and sanctions.
The group, which involves executives from European oil firms such as OMV and Eni and gas and power firms such as Fluxys and Engie, will meet behind closed doors in Brussels under the auspices of the European Commission on Thursday.
Workshop - Part - EU - Push - Dominance
The workshop is part of an EU push to challenge the dominance of the dollar, with an EU official saying such a shift must be market-led.
Participants are invited to dig into “constraints on (market-initiated) alternatives to the use of U.S. dollar through wider use of the euro, in spite of the benefits of such a change”, the Commission said in materials prepared for the meeting.
Meeting - Part - Consultation - Process - Input
The meeting, part of a consultation process until mid-2019, is expected to provide new input to EU plans for promoting the euro in energy trading.
“The EU is the world’s largest energy importer with an annual energy import bill averaging 300 billion euros in the last five years. Roughly 85 percent of this amount is paid in U.S. dollars,” according to the materials for the meeting.
Commodities - Producers - Importers - Russia - China
Other major commodities producers and importers such as Russia and China have also long sought to increase the role of other currencies in commodities trading.
“Washington doesn’t like cartels like OPEC,” said one participant involved in preparing for the meeting, referring to the Middle East-dominated Organization of the Petroleum Exporting Countries.
Market - Currency - Dollar
“But then how can you have one market dominated by one currency – the dollar.”
Some industry players are skeptical, however, and not participating in the meeting as they say making space for the euro in international payments is too long-term a process.
“More than promotion, you...
Wake Up To Breaking News!