Digital yuan used to settle crude oil trade for Chinese oil company: Report.

Chinese oil and gas company PetroChina has reportedly become the first company to settle crude oil trade using China’s central bank digital currency (CBDC), the digital yuan. The transaction occurred at the Shanghai Petroleum and Natural Gas Exchange (SHPGX), where PetroChina allegedly purchased a million barrels of crude oil. The specific details of the deal, including the seller and the value, were not disclosed.

The announcement was made by the SHPGX, stating that the Shanghai Municipal Party Committee and Municipal Government had issued work requirements to promote the use of the digital yuan in cross-border renminbi payments for international oil and gas trade transactions.

The digital yuan, also known as e-CNY, was first introduced in 2021 after the People’s Bank of China had been working on its development since 2014. Earlier this year, reports emerged that the CBDC had been used to pay civil servants and government employees in the city of Changshu in the Jiangsu province.

China has been actively exploring various use cases for the digital yuan and has incorporated it into its official cash reports. According to a Bank of International Settlements survey, approximately 93% of central banks worldwide expressed interest in exploring some form of CBDC.

While China is one of the few countries to have rolled out a CBDC, its adoption and implementation are closely monitored by other nations. The potential benefits of a digital currency, including faster and more efficient cross-border transactions, have piqued central banks’ interest globally.

Using the digital yuan to settle a significant crude oil trade marks a milestone for PetroChina. It showcases the growing acceptance and integration of digital currencies in traditional industries. As central banks continue to explore and develop their CBDCs, the future of digital currencies in international trade and finance is on the horizon.