New Delhi, October 8, 2025 (Agencies): India has begun settling payments for Russian oil imports in Chinese yuan, in what analysts are calling a significant step toward de-dollarization of global energy trade. The move follows a series of transactions by Indian Oil Corporation (IOC), which recently paid for multiple cargoes of Russian crude using yuan.
According to Reuters, several Russian oil traders have started demanding payments in yuan, taking advantage of a recent thaw in India–China relations. By settling in yuan, Indian refiners can bypass the earlier multi-step currency conversion process through U.S. dollars or UAE dirhams, thereby cutting costs and speeding up transactions.
Although oil contracts remain priced in U.S. dollars to comply with the European Union’s price cap on Russian oil, settlements are increasingly being executed in yuan. This approach allows Russian sellers to more easily convert yuan into rubles while enabling Indian buyers to avoid complications linked to Western financial sanctions.
Indian refiners briefly experimented with yuan settlements in 2023 but halted after government objections amid strained relations with Beijing. Private refiners, however, continued using the Chinese currency throughout that period. Analysts believe the renewed adoption of yuan reflects India’s strategic balancing between major global powers and its intent to diversify payment mechanisms in the face of geopolitical pressures.
Observers say this development strengthens China’s position in global energy trade, provides Russia with alternative payment channels, and underscores India’s growing role in shaping multipolar trade structures.