The petro-yuan has just been launched. The Yuan backed crude oil future is now available in Shanghai. The new oil futures contracts opened on the exchange for about $69.70 per barrel or 440.20 yuan. Close to 19,000 have been sold.
Oil prices globally have soared to a 3 year high reaching $71 a barrel with Brent Crude (U.K). Also West Texas Intermediate is also at a 3 year high around $66. The investors were very anxious to buy the oil contracts from the world's largest oil consumer.
The petro-yuan could and most likely will put a big dent in the petro-dollars dominance in the oil markets.
Investors who wanted to sell/buy oil normally would have to trade their own currency into USD to make this happen. Of course this was good for the US dollar, they could just be printed and sold to anyone who wanted to purchase oil (commodity).
A lot of the news leading up to this was concerning foreign investors being put off by China’s government intervention in the yuan. That didn’t stop commodity giants Trafigura Group and Glencore Plc from participating in the petro-yuan futures. This will still be a long journey and no one's sure if these large commodity investors will be here for long.
If the yuan is trusted and is credible this may be beginning of the end of the USD.
This is starting to bring in alot of people congratulating China on beginning to stop the USD tyranny for all these years.