The BRICS are considering using the Chinese yuan for oil payments in order to reduce dependence on the US dollar. The BRICS alliance, consisting of Brazil, Russia, India, China and South Africa, is reportedly considering introducing a “petroyuan” to compete with the dollar’s dominance in global oil trade. This issue is expected to be discussed at the upcoming BRICS summit in Kazan, Russia, to establish an alternative to paying for oil in dollars using the yuan.
This comes after the world's largest oil exporting nation, Saudi Arabia, expressed interest in pricing oil in yuan, dealing a major blow to the petrodollar system.
The country has traditionally sold its oil in US dollars, but has expressed interest in diversifying its shopping basket in line with current international financial practices. Russia is also interested in the petroyuan, as Moscow seeks to reduce the use of the US dollar and facilitate transactions through SWIFT.
Following its exclusion from SWIFT in 2022 due to the conflict in Ukraine, Russia has been exploring alternative methods for international financial transactions.