Petrodollars

AAA

DEFINITION of 'Petrodollars'

The money earned from the sale of oil. The term "petrodollars" was coined when the price of oil rose sharply in the 1970s. It resurfaced in the new millennium, when prices rose once again. Although petrodollars initially referred primarily to money that Middle Eastern countries and members of OPEC received, the definition has broadened in recent years.

INVESTOPEDIA EXPLAINS 'Petrodollars'

Petrodollars are the primary source of government revenue in many Middle Eastern countries. In fact, these funds represent a massive amount of investment capital and, in fact, are often traded on the eurocurrency market. They are also used for development purposes. In the 1970s and 1980s, Bahrain was able to improve its industrial capacity through the use of petrodollars.



RELATED TERMS
  1. Excess Crude Account

    A Nigerian government account used to save oil revenues above ...
  2. Cartel

    An organization created from a formal agreement between a group ...
  3. Commodity

    1. A basic good used in commerce that is interchangeable with ...
  4. Organization Of Petroleum Exporting ...

    An organization consisting of the world's major oil-exporting ...
  5. Sweet Crude

    A type of oil that meets certain content requirements, including ...
  6. Sour Crude

    The name given to barrels of crude oil that do not meet certain ...
Related Articles
  1. Sovereign Wealth Funds - Friend Or Foe?
    Investing Basics

    Sovereign Wealth Funds - Friend Or Foe?

  2. Exploring The Current Account In The ...
    Economics

    Exploring The Current Account In The ...

  3. An Introduction To Sovereign Wealth ...
    Mutual Funds & ETFs

    An Introduction To Sovereign Wealth ...

  4. What Is The World Trade Organization?
    Economics

    What Is The World Trade Organization?

comments powered by Disqus
Hot Definitions
  1. Harvest Strategy

    A strategy in which investment in a particular line of business is reduced or eliminated because the revenue brought in by ...
  2. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  3. Pareto Principle

    A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The ...
  4. Pareto Principle

    A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The ...
  5. Budget Deficit

    A status of financial health in which expenditures exceed revenue. The term "budget deficit" is most commonly used to refer ...
  6. Floating Exchange Rate

    A country's exchange rate regime where its currency is set by the foreign-exchange market through supply and demand for that ...
Trading Center