Russian coal bought in Chinese yuans is heading to China. As to Russian crude also paid for in CNY, it will arrive in May.
China used to pay for Russia’s hydrocarbons in US dollars. However, when Russian banks were banned from the SWIFT international system, settlements were halted.
China is preparing to receive the first cargoes of Russian coal paid for in yuans in April, Bloomberg reported, citing a source familiar with the matter. Meanwhile, the first shipments of Russian crude are expected to be delivered next month.
A spokesperson for Fenwei Energy Information Services confirms the purchase of coal from Russia in CNY by several Chinese companies in March. The first shipments of ESPO crude are due to arrive in China's oil refiners in May, according to Bloomberg.
Coal for power and steel plants purchased in the Chinese currency used to be paid for in dollars, Fenwei Energy Information noted. Buyers are interested in expanding imports from Russia but logistical and financial problems stand in the way, China’s coal transportation and distribution association said.
In late March, China’s Ministry of Foreign Affairs confirmed the possibility of making energy settlements in rubles and yuans, saying local companies were planning to use national currencies in trade with Russia. At the same time, they did not rule out the possibility of settlements in other currencies.
Russia has repeatedly announced its intention to ditch the dollar in international settlements. In April, its authorities demanded that the so-called “unfriendly nations” pay for gas and oil in rubles. Russia’s President Putin has made it clear he wants foreign buyers to purchase commodities using RUB as Western currencies prove to be unreliable and discredited.
