The Petrodollar's Influence: From Cristiano Ronaldo to Global Finance
The Rise of the Petrodollar and Cristiano Ronaldo
Cristiano Ronaldo’s move to Al-Nassr, a Saudi Arabian club makes him the highest-paid athlete in the world.
Getting Ronaldo onboard is a strategic play by Saudi Arabia to enhance its appeal to football lovers across the world. This comes on the heels of PIF, the Saudi Arabian sovereign wealth fund, investing into Newcastle United in 2021.
Moves such as these are possible because of the wealth generated from years of oil exports. PIF’s assets amount to over of $600 billion.
The IMF forecasts that due to rising oil prices, the Middle East’s oil and gas producers are set to reap up to $1.3tn in additional revenue over the next four years. Much of it will flow to the Gulf countries, home to top crude exporter Saudi Arabia and the largest liquefied natural gas exporter Qatar.
Where does PIF allocate the funds to? Primarily Tech – Nintendo, Microsoft, Zoom, Alphabet to name a few.
This soaring wealth drives the moves of global finance as well,
In 2008, as the oil price soared to $147 a barrel, bankers and financiers were knocking on sovereign wealth fund’s doors seeking investments. Citigroup, Credit Suisse and Barclays were some high-profile companies bolstered by injections of Gulf petrodollars.
Who do you think will benefit from the rise of petrodollars this time around?