Concept: December 7, 2021. Defining the Petroyuan

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The petroyuan is a futures contract available for trade on the Shanghai International Energy Exchange. It is based on crude oil as the underlying asset. It is an alternative to the petrodollar, which has kept the hegemony for almost 50 years. This is the way that currently China purchases oil from Russia.

The Chinese currency does not enjoy the prestige of the US dollar so, in order to make the petroyuan attractive to investors outside of China, it is backed by gold. The proceeds are convertible to gold on exchanges in Shanghai and Hong Kong.

For further reading, click this link.

This post is intended to only raise awareness. In order to make actual financial decisions please contact your financial advisor and/or tax advisor prior to making the decision.
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