The Petrodollar and the Iran Crisis: An Accelerator of De-dollarization
By Gabriel Arès · April 7, 2026 · 10 min read
The first part of this series explained the origins of the petrodollar and its dominant role for more than fifty years. The second part analyzed the concrete signs of its weakening in 2025-2026, including the decline of the dollar’s share in global reserves, the rise of the petroyuan, and the growing influence of BRICS+.
Recent events add a concrete and urgent chapter to this analysis. The conflict between the United States, Israel, and Iran, triggered in late February 2026, has caused a major global energy crisis linked to the disruption of the Strait of Hormuz. This crisis serves as a geopolitical catalyst and accelerates the de-dollarization trends already observed.
An Unprecedented Energy Crisis
For more than six weeks, fighting has disrupted traffic through the Strait of Hormuz. This passage carries approximately 12 million barrels per day of crude oil and refined products — more than 10% of daily global demand. The crisis is not limited to rising crude prices; it also affects refined products such as gasoline, diesel, and jet fuel.
These difficulties particularly affect importing countries in Asia and Africa. Iran has also attacked energy infrastructure in the Gulf, reinforcing the supply shock. Even with a rapid ceasefire, the effects will persist for several months: logistics delays, jet fuel prices already doubled in Singapore, and inflation risks.
This interruption of oil flows reveals a fundamental weakness of the petrodollar system: when oil no longer flows normally, global demand for dollars to finance these exchanges decreases.
China: Strategic Mediator and Petroyuan Accelerator
China plays a central role in this crisis. As the main importer of Iranian oil and gas, it is actively participating in indirect negotiations between the United States and Iran, organized in Pakistan. Together with Pakistan, it proposes five peace principles, including an immediate ceasefire and protection of maritime routes, including the Strait of Hormuz.
On the monetary front, Iran is accepting more yuan payments for oil and ship transit. This accelerates the emergence of the petroyuan. China, already using the mBridge platform and CIPS system, is leveraging the situation to further reduce dollar dependency, especially amid trade tensions with Washington.
Europe Facing Its Second Energy Shock
Europe, which had already reorganized its supply chains after Russia’s invasion of Ukraine, faces a second energy shock. The Gulf crisis risks sharply increasing oil and LNG prices, testing the energy architecture put in place since 2022.
This new event underscores Europe’s persistent vulnerability to Middle East disruptions and the limits of the petrodollar in ensuring energy stability for its allies.
Implications for the Petrodollar: Accelerated Multipolarity
These facts confirm and accelerate previously described trends. The temporary decline in oil volumes and increased use of other currencies — notably the yuan — reduce the classic recycling of petrodollars into U.S. Treasury bonds. American economic sanctions lose their effectiveness when actors bypass the dollar.
In the short term, the dollar can still serve as a safe haven. In the medium term, between 2026 and 2030, the crisis reinforces the scenario of a controlled transition toward a multipolar system where the dollar coexists with the renminbi and other digital currencies. It also accelerates the green energy transition, which will reduce global oil demand.
Key Takeaways
The 2026 Iran crisis does not abruptly end the petrodollar, but it clearly accelerates its transformation. Fifty-two years after the historic 1974 agreement, the system faces a very different geopolitical and energy reality. China-led negotiations, European difficulties, and Strait of Hormuz disruptions all illustrate this acceleration toward monetary multipolarity.
The international economic order is becoming more fragmented, more complex, but also potentially more balanced. For all global actors, including Canada and Quebec — sensitive to energy prices — the challenge is now to adapt quickly to this new reality.
Sources: Colibasanu, A. (2026). Europe’s second energy reckoning. Geopolitical Futures; Friedman, G. (2026). China and the Iran negotiations. Geopolitical Futures; Russell, C. (2026). It’s time to end the world’s delusions over the Iran energy crisis. Reuters.