Russian coal and oil paid in yuan will begin to arrive in China as the two countries try to maintain their energy trade in the face of growing world anger over Ukraine’s aggression.
Several Chinese firms used the local currency to buy Russian coal in March, and the first cargo will arrive this month, said Chinese consultant Fenwei Energy Information Service Co.
This will be the first commodity shipment paid in yuan since the United States and Europe punished Russia and blocked some of its banks from the international financial system.
Russia was China’s second -largest supplier of coal last year which has filled a gap caused by disputes between Beijing and Australia thus impacting bilateral trade.
Meanwhile, Russian crude oil sellers are also offering to give leeway to the world's second -largest economy to pay using the yuan, where first -grade ESPO cargo purchased with Chinese currency will be sent to an independent refinery in May.
China has long struggled with the dominance of the U.S. dollar in global trade and the political influence it exerts on America.
However, the use of the yuan is seen not to pose a serious challenge to the dominance of the US dollar given its huge gap. The US currency was used for 88% of foreign exchange transactions in 2019, compared to 4.3% for the yuan.
