Why is oil bought in dollars?
Oil is bought in dollars because it is a commodity. All commiditiesin the US are bought in dollars. This is because it's then easierto trade them
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the exchange determines the currency. US exchanges choose dollars,the Hang Sin trades in yen. The values of a currency used on anexchange can affect a commmodities market as well as other marketforces. Commodite traders in the US tade worldwide on differentexchanges and different currencies.
in some cases a trader can make as much off currency fluctuationsas they do off the commodity depending on what happens in the worldand on which exchange they sell the commodity. Oil for example canchange hands several times as a tanker heads to a port or it may goto a different port and a different buyer. Oil traders will oftenpark a tanker and store the oil awaiting better currencyconditions.
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