Countries in the world are engaging in crude and petroleum product trades using alternative currencies. In 2023, approximately 20% of global oil transactions were facilitated in currencies other than the US dollar, notably as Russia and Iran supplied cargoes to other purchasers.
Banks in these two countries can now use non-SWIFT messaging platforms and bilateral brokerage links to facilitate transactions in the ruble and Iranian rial following an agreement to trade in their local currencies. Saudi Finance Minister has also expressed openness to using currencies other than the U.S. dollar in oil contracts. Though no practical changes were observed, it has the potential to precipitate a notable shock to the currency landscape.
