China has officially issued its first oil futures contract denominated in its local currency, the Yuan, in a long-awaited move, challenging the dollar's oil.

China launches first oil contracts in yuan

 26 March 2018 01:47 PM

China has officially issued its first oil futures contract denominated in its local currency, the Yuan, in a long-awaited move, challenging the dollar's oil.
Liu Xiao, chairman of China Securities Regulatory Commission, said the body has the confidence and ability to build a secure future oil futures market, saying it will play an important role in the country's economy, citing the China Morning Post.

The idea of ​​China issuing yuan-denominated contracts dates back to 2012, when the price of a barrel exceeded $ 100 a barrel.

Last month, China hinted that the move was nearing completion, after reports that the contracts would be launched this month after five tests of the system last year, and a slight flaw was detected in the trading platform that was promised to be processed.

Brent crude for September delivery in its first offer on Monday was 440.20 yuan ($ 69.70 per barrel), up 6 percent from its benchmark price of 416 yuan.

Crude then lost some of its gains to record 429.9 yuan ($ 68.28 per barrel), but is still 3.3 percent higher than its benchmark price.

The move is a real threat to the United States, which dominated the currency for years on the price of crude, as the previous statements all the issuance of oil denominated in a currency other than the dollar was the end of failure.

In 2015, Russia, the largest oil producer, announced that it would like to carry out all crude purchases with China using the yuan.

On the other hand, that step serves China, which is the largest importer of crude, with its oil imports in 2017 about 420 million tons, an increase of about 10.7% from the level in 2016.
By 1040 GMT, the price of Brent crude futures fell 0.2% to $ 70.34 a barrel.

Nymex crude futures fell $ 65.62 a barrel, falling 0.4%.   link