China refused to buy oil and gas for dollars

Last Friday, the leaders of the Arab countries of the Persian Gulf and other countries of the Middle East held a meeting in Saudi Arabia as part of a visit to this country by Chinese leader Xi Jinping. The Chinese authorities have announced that they intend to continue importing large volumes of oil and gas, but the calculations will be carried out only in Chinese yuan.

«The platform of the Shanghai Oil and Natural Gas Exchange will be fully used for settlements in yuan when trading oil and gas,» the Chinese president said.

It is not yet known when these changes will take effect and whether they will come into force at all. But Saudi Arabia, the world's largest oil exporter, has already begun negotiations on using the yuan for settlements in the sale of energy resources.

Experts note that such a move would weaken the role of the US dollar as the world's reserve currency, accelerating «de-dollarization». It is no secret that China is trying to make the yuan the dominant reserve currency in the world, but this national currency of the People's Republic of China is still not freely convertible and Beijing still controls its exchange rate. 

«The Saudis have something to buy from China, and China has something to buy from Saudi Arabia. Why should they make transactions in a third–party currency and bear the costs associated with an extra currency conversion?» the Chinese authorities asked. 

Currently, China uses the yuan to buy Russian energy resources, but most of the world trade is denominated in the US dollar.