Saudi Arabia Officially Open to Oil Trade in Currencies Other Than U.S. Dollar

Is the end of the petrodollar among us?

The Kingdom of Saudi Arabia is officially open to discussing oil trade settlements in currencies other than the U.S. Dollar, according to the country’s finance minister.

Saudi Arabia is officially open to discussing oil trade settlements in currencies other than the U.S. dollar.

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“There are no issues with discussing how we settle our trade arrangements, whether it is in the US dollar, whether it is the euro, whether it is the Saudi riyal,” Mohammed Al-Jadaan told Bloomberg TV on Tuesday in an interview in Davos.

As WeLoveTrump previously reported, Saudi Arabia was considering pricing oil in Chinese Yuan as opposed to USD.

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However, it appears Saudi Arabia isn't ruling out any discussions to improve global trade.

Saudi Arabia is the world's largest oil exporter, so this potential shift from the U.S. dollar has major ramifications.

Bloomberg reported:

The world’s largest oil exporter, which has maintained a currency peg to the dollar for decades, is seeking to strengthen its relations with crucial trade partners including China. The kingdom is a pillar a petrodollar system established in the 1970s that relies on pricing crude exports in the US currency.

During President Xi Jinping’s visit to Riyadh last year, the two countries agreed to boost coordination on energy policy and exploration. During that trip Xi said that China would make efforts to buy more oil from the Middle East and also wanted to settle that trade in the yuan.

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“We enjoy a very strategic relationship with China and we enjoy that same strategic relationship with other nations including the US and we want to develop that with Europe and other countries who are willing and able to work with us,” Al-Jadaan said.

Chinese President Xi Jinping visited Saudi Arabia last month in hopes of strengthening economic ties between the two countries.

Oil Price noted:

Last month, China and Saudi Arabia agreed to expand crude oil trade as they upgraded their relations to a strategic partnership during the visit of Chinese President Xi Jinping in the Saudi capital Riyadh.

China, for its part, plans to make its own currency, the yuan, more prominent in international oil trade.

During a visit to Saudi Arabia last month, Xi Jinping pledged to ramp up efforts to promote the use of the yuan in energy deals, suggesting at a summit in the Saudi capital that the Gulf Cooperation Council (GCC) countries should make full use of the Shanghai Petroleum and Natural Gas Exchange to carry out its trade settlements in yuan.