india buys oil using gold - what does it mean?

The EU has banned the import of crude oil from Iran. India however will continue to buy Oil, not in US Dollars, but in Gold.

India spends USD $12 billion on IRANIAN Oil each year so this could have a major impact on the price of Gold if it continues into the long term.

The video linked below does not mention how much oil will be bought in gold, but one would imagine that the longer the EU and US want to "ban" Iranian oil then the more likely the purchases will continue to be made in Gold rather than Dollars.

USD $12 Billion in Gold equates to 7,272,727 oz of Gold (at $1,650).

The World only produces 2500 tons or 80 million oz of gold a year.

So if this oil deal was ever paid for 100% in gold it would equate to 9.125% of the Worlds Gold supply being used each year.

(I'm not saying the entire deal will be paid for in Gold, I am just showing these figures to highlight how little gold there is and what one or two major deals in gold could do to the demand/price).

Furthermore, China is also mentioned as a country that may be interested in using Gold to pay for Iranian Oil.

Combined these two countries account for 40% or Iranian Imports and I am sure they would be happy to increase that percentage if Iran offered them a good deal seeing as they cant see the oil anywhere else (EU & US).

Finally, Russia also wants to continue to trade using domestic currencies rather than USD.

http://www.youtube.com/watch?v=EH3OyhiiIbY&feature=g-all-u&context=G26d244cFAAAAAHgADAA

Obviously any increase in Gold will significantly increase the value of Kentors Projects (as shown by Chuks previous figures/posts).

I also think that if the US and Eu are stupid enough to use military action then their currencies will continue to drop as they are plunged further into debt. This can only lead to a greater interest in Gold as a store or wealth and global measure of currency.