The Independent (UK) reports on secret talks aimed at replacing dollar-denominated oil with a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency.
It seems reasonable to consider an oil import tariff.
A tiered, temporary tariff could help wean the United States off of foreign oil.
- Tier 1, no tariff: oil sourced from Canada, Mexico
- Tier 2, light tariff: oil sourced from democracies with a free press
- Tier 3, full tariff: oil sourced from other nations
- Tier 4, punative tariff: Oil whose origin is undeclared or undetermined
This tariff would address the same goals as a carbon tax, help shift us away from foreign sources of oil, encourage energy efficiency and technology gains, and be a measured, quantifiable response to this latest move by oil producers.
Oil diplomacy would roil world affairs, but that's nothing new. Probably difficult if we want any amount of Arab help with Iran, an issue rapidly heating up. At home, oil prices would likely increase a bit, serving to decrease demand.
Risky? Sure. But some new thinking is needed, and cap-n-trade is not it.