Indian-owned refiner pays for shipments of Russian oil in yuan
(MENAFN) India’s largest state-run refiner, Indian Oil Corporation (IOC), has reportedly completed several payments for Russian oil using the Chinese yuan, according to reports.
The decision came after traders supplying Russian crude began requesting Indian state-owned refiners to settle transactions in the Chinese currency. Traditionally, India’s oil payments are made in US dollars or UAE dirhams, which are later converted into Russian rubles by intermediaries. Switching to yuan payments, a trader explained, removes this extra step and cuts associated costs.
The yuan has become one of the main foreign currencies circulating in Russia, now considered among the world’s largest offshore trading centers for the Chinese currency. Although Russian oil is still priced in dollars to comply with the EU’s price cap, suppliers are increasingly requesting the equivalent amount to be paid in yuan, according to reports.
Since 2022, India has dramatically expanded its purchases of discounted Russian crude and has simultaneously emerged as a leading supplier of refined petroleum products to Europe. However, this growing trade relationship with Moscow has drawn criticism from Washington. In August, US President Donald Trump imposed 25% tariffs on most imports from India in response.
State refiners in India had previously used yuan payments for Russian oil in 2023, but those transactions were halted amid strained relations with Beijing. Private refiners, however, continued to use the Chinese currency.
Recent months have seen both New Delhi and Beijing take steps to mend ties, which were severely damaged following the 2020 border clash that resulted in casualties on both sides.
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