Saudi Arabia is in discussions to possibly accept payment for its oil sales in the yuan instead of the US dollar.
- The negotiations between the two parties have been intermittent win the past six years but have recently been bumped up with the Saudi Arabian government becoming increasingly displeased with US security commitments.
- Saudi Arabia is said to be dissatisfied with the supposed lack of support from the United States regarding the intervention in the civil war in Yemen, along with the American government’s efforts to ink a deal with Iran regarding its nuclear program.
- The talks also come with China beefing up its efforts to build up its ties with Saudi Arabia, after assisting in building ballistic missiles. Saudi Arabia has also invited Chinese President Xi Jinping to visit later in 2022.
- The United States is currently among the top producers of oil across the globe. It imported some 500,000 barrels a day in December 2021, after previously importing as much as 2 million barrels of crude daily from Saudi in the 1990s.
A top US official said Saudi Arabia’s possible acceptance of Chinese payments in yuan is unlikely but flagged that this would be “highly volatile and aggressive.”
KSA is down 0.26%, while QQQ is up 2.56%.
Source: WSJSaudi Arabia