Petro-CNY: Timing, reach, geopolitics, and implications


As the world’s biggest buyer of oil, China may view the settlement of oil in Chinese yuan as a natural course of development.
Group Research23 Apr 2018
Photo credit: AFP Photo


One of our predictions after the nineteenth Party Congress was the impending establishment of a Petro-CNY system backed by gold. Evolving economic and geopolitical forces may well hasten this dynamic.

Not only is China the largest exporter in the world, its imports are the second-largest as well. It is the biggest net importer of oil in the world, surpassing the US and Germany in 2016. For oil producers, such as the Gulf states, Russia, and Venezuela, there is hardly any buyer as important as China. Settlement of oil in Chinese yuan (CNY) is a natural course of development, from Beijing’s perspective.
  Chris Leung
Economist - China & Hong Kong
chrisleung@dbs.com

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