“The Saudis have a lot to buy from China and China has a lot to buy from Saudi Arabia. Why should they transact in a third-party currency and incur all of these exchange-rate costs?” – Gal Luft, Institute for the Analysis of Global Security
USAGOLD note: Oil for yuan settlements are not an immediate threat to the dollar, and, according to this article, Xi’s program is still in its formative stages. At the same time, if and when the flow begins, forward-looking forex traders will attempt of determine at what point it actually does begin to dent the dollar trade. China is now settling energy purchases from Russia in yuan.