Is the petrodollar dying?
Yesโbut slowly, and โdyingโ is probably too strong a word to use here.
Whatโs happening in 2026 is better described as an erosion of the traditional petrodollar system. For decades, much of the worldโs oil trade was conducted in U.S. dollars, and oil exporters recycled substantial portions of those dollars into U.S. financial assets. Today, some oil transactionsโparticularly involving China, Russia and Iranโare increasingly being settled in yuan and other currencies. Reuters estimates that as much as 20% of global crude trade may now be priced in currencies other than the dollar, although there is no definitive official global figure.
There are several reasons: Asia has become much more important to Gulf producers, the U.S. itself has become a major oil producer and net energy exporter, geopolitical tensions have encouraged countries to diversify payment systems, and Gulf states increasingly have domestic uses for their oil revenues rather than automatically recycling them into U.S. securities. Reuters reports that Saudi Arabia sells roughly four times as much oil to China as to the United States, illustrating how dramatically the geography of the oil market has changed.
But hereโs the important counterweight: the dollar remains dominant.
According to the IMFโs latest available COFER figures, the dollar represented about 57.1% of disclosed global foreign-exchange reserves in Q1 2026. The Chinese renminbi remains only a small fraction by comparison. Saudi Arabia also continues to peg the riyal to the U.S. dollar, and the IMF reaffirmed in July that Saudi authorities regard that peg as appropriate.
So Iโd characterize it this way โฆ$
1970sโ2000s: overwhelmingly dollar-centric oil system
2020s: dollar-dominant but increasingly multi-currency
Future: potentially a mixture of petrodollars + petroyuan + other currencies, rather than one currency abruptly replacing the dollar.
And one widely circulated claim deserves caution: there wasnโt a simple โ50-year U.S.-Saudi petrodollar contract that expired in 2024 and ended the petrodollar.โ The system developed from a broader collection of U.S.-Saudi security, economic and financial arrangements rather than one magical contract whose expiration automatically terminated dollar oil trading.
The bigger question is actually not whether oil stops being priced exclusively in dollars. Itโs whether foreign governments, companies and investors eventually find sufficiently deep, liquid and trusted alternatives to U.S. dollar assets. Thatโs a much higher hurdleโand the dollar still has an enormous advantage there.
You wake up tomorrow. Your bank balance is $0.
Imagine waking up tomorrow, grabbing your phone and trying to buy a coffee.
Your card doesn't work.
You open your banking app.
Nothing.
You refresh it.
Still nothing.
Then the calls start.
Your friends can't access their money either. Neither can your parents.
Millions of people are staring at the same nightmare.
No planes. No collapsing buildings.
Just panic spreading from phone to phone as people realize the money they spent their entire lives building may suddenly be unreachable.
That's the frightening scenario Professor Jiang Xueqin lays out in his conversation with Steven Bartlett.
If America suffered another 9/11-scale attack, Jiang believes the financial system could be the target.
It's a prediction, not a certainty. But Chinese growth in quantum computing is exponential. A 4000 logical qbit machine can break militry grade encryption, think crypto, stocks, banking telegram, whatsapp...
But that's exactly what makes this conversation so unsettling.
The attack he's imagining isn't designed to destroy a building.
It's designed to destroy your feeling that tomorrow will work keep on working like today.
Credit: Professor Jiang Xueqin for the analysis and prediction, and Steven Bartlett for the interview.