Saudi Arabia, UAE, Qatar Explore Shift From Dollar to Yuan in Oil Sales

Saudi Arabia, the United Arab Emirates, and Qatar are reportedly evaluating the use of the Chinese yuan for oil and gas sales instead of the U.S. dollar, amid escalating regional tensions tied to the Iran conflict and disruptions in the Strait of Hormuz. The developments have intensified discussions around alternative settlement currencies as supply chains and shipping routes face pressure.

The potential shift reflects growing concern among Gulf exporters over financial stability during geopolitical shocks, with yuan-based transactions seen as a possible way to diversify trade settlement systems, particularly with Asia as a major energy buyer.

UAE Discusses Currency Swap Line With U.S. Officials

Separately, the UAE has engaged U.S. authorities on establishing a financial safety net. During meetings in Washington, UAE Central Bank Governor Khaled Mohamed Balama raised the idea of a currency swap line with U.S. Treasury Secretary Scott Bessent and Federal Reserve officials. The mechanism would provide dollar liquidity support if regional conditions worsen.

Strait of Hormuz Disruption Raises Economic Pressure

The closure of the Strait of Hormuz has added strain to Gulf economies, increasing concerns about trade flow stability. While the UAE has so far avoided severe economic fallout, officials acknowledge that prolonged disruption could force stronger financial contingency measures and accelerate currency diversification discussions.