War on Iran could be 'catalyst' for erosion of US petrodollar, Deutsche Bank says

A Deutsche Bank report warns that a US-Israeli war on Iran could be a catalyst for the erosion of the petrodollar system. This system relies on Gulf states selling oil in US dollars and reinvesting the proceeds in US Treasuries in exchange for American security guarantees. The arrangement helps keep US borrowing costs low, but the conflict is reportedly causing regional allies to doubt the reliability of US security commitments. This erosion of trust could eventually lead oil producers to move away from the dollar, threatening its global reserve currency status.