Russia Says Yuan Gaining Ground in Global Oil Payments

By Al Mayadeen English

Russian Finance Minister Anton Siluanov says global oil payments are increasingly shifting from the US dollar to the Chinese yuan amid tensions in the Strait of Hormuz.

Russian Finance Minister Anton Siluanov said global oil transactions are increasingly shifting from the traditional US dollar toward the Chinese yuan amid tensions surrounding the Strait of Hormuz, as countries search for more reliable payment mechanisms.

Speaking to RIA Novosti ahead of the BRICS New Development Bank Board of Governors meeting, Siluanov said recent geopolitical developments have accelerated efforts by states to reduce dependence on the dollar and rely more heavily on national currencies in international trade.

“Due to the situation in the Strait of Hormuz, oil payments are shifting from traditional dollar payments to the yuan,” Siluanov said, adding that countries facing political pressure are increasingly viewing alternative currencies as safer and more stable options.

According to the Russian minister, the transition is no longer limited to Chinese oil importers, with other states also adopting the yuan for energy settlements as global trade patterns continue to evolve.

The BRICS New Development Bank Board of Governors is scheduled to convene in Moscow on May 14 and 15, marking the first time the Russian capital has hosted the annual meeting since the institution was established by BRICS nations in 2014 to support development and infrastructure financing.

Oil shocks mainly affecting US

An analysis by Responsible Statecraft released earlier in May said the United States could face more severe economic consequences from rising oil prices linked to disruptions in the Strait of Hormuz than other major economies, including China, Russia, and the European Union.

The assessment challenges claims by US President Donald Trump and his administration that domestic oil production shields the country from global price volatility following the war on Iran and its repercussions. 

Analysts say oil prices are shaped by global supply and demand rather than national production levels, meaning disruptions affect all economies regardless of their output. The closure of the Strait of Hormuz has removed an estimated 10 million barrels of oil per day from global supply, significantly tightening the market and driving up prices worldwide.

Oil prices hit four-year high as Trump vows to keep Hormuz blockaded

Against the backdrop of mounting warnings over the United States’ vulnerability to oil price shocks, the Trump administration has doubled down on its hardline stance, insisting on maintaining a naval blockade of Iranian ports.

Oil prices surged to their highest level in nearly four years on Thursday, driven by a lack of progress toward reopening the Strait of Hormuz and continued geopolitical tensions following the late-February US-Israeli war on Iran.

Brent crude rose as much as 4.3% to $123.11 per barrel, marking a ninth consecutive day of gains, the longest winning streak since May 2022.

The rally has pushed oil prices up more than 100% this year, with momentum further supported after Trump told Axios he would maintain a naval blockade on Iranian ports until securing a nuclear agreement with Tehran.

The spike in energy prices weighed on broader market sentiment, offsetting gains fueled by strong earnings in the technology sector. Futures for the Nasdaq 100 Index pared earlier advances to 0.3%, down from as much as 1%, while MSCI’s Asia Pacific shares index fell 1%.