At OPEC's recent summit in Riyadh, both Iran and Venezuela argued for OPEC's severing the historic link between crude oil and the U.S. dollar. "They get our oil and give us a worthless piece of paper," Iranian President Mahmoud Ahmadinejad complained. Venezuelan President Hugo Chavez concurred stating that "the empire of the dollar has to end."

Both leaders lost their battle at OPEC and the summit's declaration made no mention of such an initiative. Not to be deterred, Iran announced that it would no longer be selling oil for dollars.

Today, Tehran's Voice of the Islamic Republic of Iran radio declared, "Deputy Head of National Iranian Oil Company [NIOC] for foreign affairs has said that Iran has stopped selling its oil in dollars. He said: Iran is not dependent on dollar for selling its oil." According to the report, Iran is now selling 80% of its oil for Euros and the remainder for Yen. Moreover, it noted that the deputy head of National Iranian Oil Company "predicted that the dollar will lose its value day by day."

Although Iran's share of the world oil market is relatively modest, its move remains consistent with a diplomatic offensive aimed at eroding American influence. Moreover, it establishes a precedent that others might well be tempted to consider should the U.S. fail to address the fundamental factors behind the slide in its currency and that erosion in value persist or accelerate. Just yesterday, China became the latest nation to express concern about the dollar's decline.

For now, Iran's move is yet another step aimed at advancing its geopolitical agenda. It is a measure that will likely backfire if the dollar can remain a store of value. If not, though, that is where things could get more worrisome.