Page 6 - DMEA Week 50 2022

DMEA SECURITY & POLICY DMEA

Chinese leader suggests that Saudi

Arabia use yuan for future oil deals

MIDDLE EAST CHINESE President Xi Jinping has suggested out yuan (RMB) settlement of oil and gas trade,”
to Arab leaders in Saudi Arabia that future oil Xi said during his speech to the China-GCC
and gas trading between China and Arab Gulf summit, according to China Daily.
states could be carried out using China’s yuan The Chinese president did not give a date as
currency instead of the dollar. But it is a proposal to when this would open.
that is not likely to take shape for some time, as Saudi Arabia is the largest supplier of crude
the global hydrocarbon industry uses the dollar oil to China. In the January-August period of
to calculate investment and budgeting. this year, the OPEC leader shipped 1.76mn bar-
Beijing is working to strengthen its interna- rels per day (bpd) to China, making up 17.7%
tional presence, especially in the Gulf, which of China’s total crude imports, according to
supplies China with the bulk of its oil and gas Chinese customs data cited by Platts. During
imports. During a state visit to Riyadh, where the January-October period, the GCC delivered
he attended a meeting with leaders of the Gulf 4.19mn bpd to China, covering a total of 42% of
Cooperation Council (GCC), a group that the market, according to Chinese customs data.
includes Saudi Arabia, Kuwait, Bahrain, Qatar, LNG shipped from Qatar, the UAE and Oman
the UAE and Oman, and a gathering of the Arab during the January-October period amounted
League, Xi said the Shanghai Petroleum and to 13.26mn tonnes, up by 47.4% year on year
Natural Gas Exchange is open to settlements in and accounting for more than 26% of China’s
oil and gas trade using Chinese yuan instead of LNG imports.
the US dollar. Last month, China’s Sinopec and Qatar
Xi also expressed China’s intention to expand Energy agreed on a 27-year supply and pur-
business links with Saudi Arabia and other Gulf chase agreement covering the delivery of Qatari
states. LNG to China until 2053. The value of the deal
“China will continue to import large quan- is reported at $60bn, with 4mn tonnes per year
tities of crude oil from GCC countries, expand being delivered to Sinopec’s regasification termi-
imports of [LNG], strengthen co-operation in nals beginning in 2026.
upstream oil and gas development, engineering During the visit, China and Saudi Arabia
services, storage, transportation and refining, signed investment agreements worth about
and make full use of the Shanghai Petroleum $50bn in both the private and public sectors,
and Natural Gas Exchange as a platform to carry Bloomberg reported. ™

Xi addressed the China-GCC summit during a visit to Riyadh (Photo: fmprc.gov.cn)

P6 www. NEWSBASE .com Week 50 15•December•2022