India just bought 1 million barrels of oil using rupees instead of USD

[fruktik]

One question - and what is the benefit of this deal ?
now the seller does not have 1 million barrels of oil, but has a lot of rupees, the liquidity of which is under great question.
There is another "perfect example" of such deals, and again there India. As you know - India is the biggest buyer of oil from an international terrorist country. And all the deals go through... you guessed it, in Rupees! In the end, only India benefits. But it is not because they are the most cunning, but because the terrorist country has no way out but to sell oil to India for pennies.
Bottom line: India got cheap oil. Russia got a lot of rupees. India refined the oil and made money. Russia... keeps the rupees - since they can't be used anywhere except to buy consumer goods in India. And russia needs the currency to buy necessary goods and technologies in the foreign market. But no one will sell them for rupees. And India has forbidden to exchange these rupees for dollars ) Does he understand the dubiousness of the benefits of working with local currencies ? And you can also model the situation as it was with the yuan - everything was fine, until the crisis began, and the yuan fell in value - what is the benefit of the party that sold for yuan for example 100 million barrels of oil ? Can't a crisis develop in India ? The dollar is more stable because it is "backed" by demand in the world economy....

Is there a way out of this situation for Russia? It seems to me that not everything is so clear-cut. After some time, they will find a solution and then the money will be returned.
Maybe pass these rupees through the stock exchange, and withdraw in another currency? Or will this option fail? Does everyone understand perfectly well what is happening and will they not allow this to be put into practice?

I only recently learned that oil wells cannot be taken and shut down so easily. They must be at work all the time. Now it is clear to me for what reason oil is being sold to India for a penny.

[Sithara007]

Trading in local currency is only beneficial to the country that's issuing out their own currency. It's a trend as of late only because USD would normally be the intermediary currency, but for sanctions on Russia and a high inflation rate.

Even countries outside of BRICS are dumping USD from their reserves and trading through alternatives.

The only reliable alternative as of now for US Dollar is gold. But then gold doesn't have enough liquidity or mobility to be used as a currency for international trade. With every other currency (including Euro, GBP, CNY or JPY), the same issues exist which are present with the US Dollar. My guess is that BRICS will never be able to get to an alternative for the USD. Each of the member nations want their own national currencies to replace the USD and to be used as an international trade currency. it will be difficult to get to a compromise deal that is acceptable to everyone.

[tabas]

In order to pay with the national currency in transactions for large amounts, it is necessary that there be a good reverse trade turnover between these two countries.

Being good trader partners and mutual talks are going to benefit countries that are in good terms. And for this deal that's made by India, it was really a good deal that they're able to make for buying a million barrel with their Indian Rupees.

That is, in this case, the UAE should be able to spend Indian rupees, purchasing in India or other countries the goods necessary for the UAE in the same volumes for rupees.

That's another thing that they can do with the Rupees used to pay them and since this trade has been made, it's also possible that they might just keep the money and wait a little bit until they able to do something with it. And that means going back to economy again of India if that's what they're going to do, buying assets in India.

Otherwise, the UAE will suffer losses from such trade in rupees, as happened with Russia. Russia is now selling its oil at deep discounts to India for rupees, but doesn't know what to do with it.
The dollar, as the world's reserve currency, has no such problems.

It's an easy deal for India if they're able to pay with their own currency and doesn't need to get converted into USD or any currency that's being preferred by their trade partners.

[DrBeer]

One question - and what is the benefit of this deal ?
now the seller does not have 1 million barrels of oil, but has a lot of rupees, the liquidity of which is under great question.
There is another "perfect example" of such deals, and again there India. As you know - India is the biggest buyer of oil from an international terrorist country. And all the deals go through... you guessed it, in Rupees! In the end, only India benefits. But it is not because they are the most cunning, but because the terrorist country has no way out but to sell oil to India for pennies.
Bottom line: India got cheap oil. Russia got a lot of rupees. India refined the oil and made money. Russia... keeps the rupees - since they can't be used anywhere except to buy consumer goods in India. And russia needs the currency to buy necessary goods and technologies in the foreign market. But no one will sell them for rupees. And India has forbidden to exchange these rupees for dollars ) Does he understand the dubiousness of the benefits of working with local currencies ? And you can also model the situation as it was with the yuan - everything was fine, until the crisis began, and the yuan fell in value - what is the benefit of the party that sold for yuan for example 100 million barrels of oil ? Can't a crisis develop in India ? The dollar is more stable because it is "backed" by demand in the world economy....

Is there a way out of this situation for Russia? It seems to me that not everything is so clear-cut. After some time, they will find a solution and then the money will be returned.
Maybe pass these rupees through the stock exchange, and withdraw in another currency? Or will this option fail? Does everyone understand perfectly well what is happening and will they not allow this to be put into practice?

I only recently learned that oil wells cannot be taken and shut down so easily. They must be at work all the time. Now it is clear to me for what reason oil is being sold to India for a penny.

Let's start with a historical excursion, shall we? Can you name any smart decision of Russia in the last 20 years ? And do you seriously believe that in the current situation, when smart India and smart China understand perfectly well the prospects of Russia, will go for some unfavorable agreements?! They have made Russia their obedient, cheap, stupid resource appendage. And neither India nor China will ever give them DOLLARS for oil !
They realize perfectly well that russia is in a hopeless situation, including a technological trap. The problem is that Russia, instead of investing in technology and development, has been plundering the country for decades. And today, most of the critical technologies for gas and oil production in Russia are Western technology and equipment. Which no one sells to terrorists now. And Russia does not have its own R&D and technology.
Regarding wells. I'll add to that:
- most of the working wells are in the so-called stage 2-3. This is when the reserves are depleting and their production is becoming more and more expensive and difficult.
- Well conservation - for Russians it is a synonym for "forget about this well". Because it is a complex and expensive process. And Russia has neither technology nor money for well abandonment.
- Russia has nowhere to store oil and gas - they have no developed storage system. For example, Russia has always stored gas in Ukraine, in its storages

Bottom line: there is nothing left for Russia but to sell and "pump" resources that they cannot accumulate in large volumes. Otherwise (if they do not sell for at least some "wrappers") they will simply stop the industry.

[be.open]

One question - and what is the benefit of this deal ?
now the seller does not have 1 million barrels of oil, but has a lot of rupees, the liquidity of which is under great question.
There is another "perfect example" of such deals, and again there India. As you know - India is the biggest buyer of oil from an international terrorist country. And all the deals go through... you guessed it, in Rupees! In the end, only India benefits. But it is not because they are the most cunning, but because the terrorist country has no way out but to sell oil to India for pennies.
Bottom line: India got cheap oil. Russia got a lot of rupees. India refined the oil and made money. Russia... keeps the rupees - since they can't be used anywhere except to buy consumer goods in India. And russia needs the currency to buy necessary goods and technologies in the foreign market. But no one will sell them for rupees. And India has forbidden to exchange these rupees for dollars ) Does he understand the dubiousness of the benefits of working with local currencies ? And you can also model the situation as it was with the yuan - everything was fine, until the crisis began, and the yuan fell in value - what is the benefit of the party that sold for yuan for example 100 million barrels of oil ? Can't a crisis develop in India ? The dollar is more stable because it is "backed" by demand in the world economy....

Is there a way out of this situation for Russia? It seems to me that not everything is so clear-cut. After some time, they will find a solution and then the money will be returned.
Maybe pass these rupees through the stock exchange, and withdraw in another currency? Or will this option fail? Does everyone understand perfectly well what is happening and will they not allow this to be put into practice?

I only recently learned that oil wells cannot be taken and shut down so easily. They must be at work all the time. Now it is clear to me for what reason oil is being sold to India for a penny.

Let's start with a historical excursion, shall we? Can you name any smart decision of Russia in the last 20 years ? And do you seriously believe that in the current situation, when smart India and smart China understand perfectly well the prospects of Russia, will go for some unfavorable agreements?! They have made Russia their obedient, cheap, stupid resource appendage. And neither India nor China will ever give them DOLLARS for oil !
They realize perfectly well that russia is in a hopeless situation, including a technological trap. The problem is that Russia, instead of investing in technology and development, has been plundering the country for decades. And today, most of the critical technologies for gas and oil production in Russia are Western technology and equipment. Which no one sells to terrorists now. And Russia does not have its own R&D and technology.
Regarding wells. I'll add to that:
- most of the working wells are in the so-called stage 2-3. This is when the reserves are depleting and their production is becoming more and more expensive and difficult.
- Well conservation - for Russians it is a synonym for "forget about this well". Because it is a complex and expensive process. And Russia has neither technology nor money for well abandonment.
- Russia has nowhere to store oil and gas - they have no developed storage system. For example, Russia has always stored gas in Ukraine, in its storages

Bottom line: there is nothing left for Russia but to sell and "pump" resources that they cannot accumulate in large volumes. Otherwise (if they do not sell for at least some "wrappers") they will simply stop the industry.

Russia does not need dollars from either India or China. Russia gets ample dollars directly from the US by selling uranium as fuel for US nuclear plants or titanium for Boeing.

[Hispo]

In isolation it’s not a big deal but I really do believe that the mass money printing & abuse of power by the US with the $ as the world reserve currency will be their downfall. We already see with BRICS that countries are willing to take action & look elsewhere. Also bitcoin in the long term is a real threat to traditional currencies & banking.

If BRICS wanted to hurt the USA economy that badly, China could do it by dumping much of their USD bonds in the market, and yet Pekin seems to be more interested in getting yield out their bonds in the long term, as they build their own system to face the hegemony of the dollar. I still believe that it will be very difficult to achieve, but not impossible.

It would take all the BRICS members to adopt a second mutual currency in their territories o move onto the Chinese Yuan.

Also, there are altcoins which in my opinion are more suitable as first-layer solution to be a threat to the traditional financial sistema than Bitcoin, because problems of scalability, mostly. Sadly, Bitcoin sounds to be more an asset than a currency nowadays.

China has aready started to dump U.S. Treasuries, BUT they don't want to do it to make the United States' economy crash. Why would you do that to the largest customer of Chinese exports. Hurting the U.S. would probably hurt them more.

Plus as the U.S. Dollar becomes more scarce because of the Federal Reserve's tightening and the restriction of swap lines, China will truly want to sell some bonds for their Dollar needs. The U.S. would be more than happy to turn the money printer on and buy all of them at the right time, and let them hold more Dollars.

The Communist party of China may be intelligent enough to realize that dumping those treasuries may affect them indirectly, however when comes to the part of getting dollars in exchange for their bonds, they can always buy gold with those dollars and further put the hegemony of Washington into question, after all, it is not convenient for USA to let the gold price to increase too much. AUX/USD pair has been considered an economical probe on the strength of the FIAT currency against one of the oldest and most reliable assets in the long term.

China eventually may try to find other consumption markets in India and Russia eventually, though, those economies do not equal the USA market.

[Wind_FURY]

This recent development should be troubling to the US but they are dismissing it as if nothing is happening. It is getting to a very critical point when they will lose total control. But even now I wonder what is it they can do. India and the UAE are both members of the BRICS. The process has started of replacing the dollar as the world reserve currency to multiple currencies.

Lol. How dumb are you? It's pretty damn evident that you have issues with the USA which is why you are stating such nonsensical stuff. Process of replacing the dollar? Extremely silly statement.

The dollar is actually growing stronger with time while the rupee is growing weaker. Think hard!

All fiat currencies weaken over time, some faster, some slower. If the rate of weakening of the fiat currency is not too fast, it is quite suitable for settlements for exported goods on one simple condition - if you intend to import goods or services for an equivalent amount. This is how bilateral currency swaps in national currencies work, which are practiced between BRICS member countries. The exchange rates of national currencies are temporarily frozen and a bilateral transaction takes place. If there is no significant imbalance in the trade balance between countries, then everything goes smoothly even without the participation of the dollar.

I will explain with an example. Let's say India wants to buy a million barrels of oil from the UAE and pay for them in Indian rupees. UAE Indian rupees are not particularly needed because it is not a freely convertible currency. But India can offer goods or services for an equivalent amount in return. In fact, the transaction turns into a barter one, where fiat currencies are involved only for the convenience of mutual settlements, but are not used as a store of value. In particular, India can offer in return some medicines or outsourced programming services or something else.

That's actually going to be a very problematic situation for Saudi Arabia, if not a laughable one. Rupees used like mere tokens in an amusement park.

I don't see anything problematic, let alone laughable, in this situation. What could be wrong with the development of balanced bilateral trade relations between the two countries? India exports offshore programming services every year for what seems to be about $400 billion, why not trade some of that for a million barrels of oil from Saudi Arabia, or does Saudi Arabia need programming services at all?

I think that Saudi Arabia is still buying them, just paying for it with US dollars, which it receives for the sale of its oil. Why is the US dollar in this scheme, is it not an extra link that only imposes a few percent of additional overhead on conversion and does not carry any useful semantic load?

I didn't mean "laughable" in that context, because from an outside perspective, "trade" requires that everyone accept the currency being used, but it would be problematic, and "laughable", in that what if Saudi Arabia needs to buy Chinese exports? Would the Chinese exporters accept the Rupees? What could be the other uses of the Rupee? Can it be used to take positions in U.S./European based investments? It's going to be cumbersome, and it would definitely be easier to convert the Rupees to U.S. Dollars upon receipt because it's what everyone accepts. Including China.

It would have been better if the BRICS nations agreed to use an apolitical, impartial, decentralized network/currency for their international trade needs. If only there was something like it invented, no?

It's too hard to implement. Theoretically, it would be possible to use bitcoin for these purposes, and there is a certain economic sense in this, but the governments of the BRICS countries are unlikely to take this step for political reasons.

Then the U.S. Dollar will win the 4D Chess game. The design decisions made behind Bitcoin makes it the perfect instrument to break the West's political stronghold in my opinion.

[be.open]

I didn't mean "laughable" in that context, because from an outside perspective, "trade" requires that everyone accept the currency being used, but it would be problematic, and "laughable", in that what if Saudi Arabia needs to buy Chinese exports? Would the Chinese exporters accept the Rupees? What could be the other uses of the Rupee? Can it be used to take positions in U.S./European based investments? It's going to be cumbersome, and it would definitely be easier to convert the Rupees to U.S. Dollars upon receipt because it's what everyone accepts. Including China.

You are right, there are advantages to using the dollar as the world's universal reserve currency, which is why the dollar is so widely accepted around the world as the world's universal reserve currency. Unfortunately, the United States began to abuse its privileges by imposing unilateral sanctions right and left - which is why even in the recent past, loyal US allies are thinking about alternative options to reduce the political risks of using the dollar and not be left completely without money for already delivered oil.

[coupable]

I didn't mean "laughable" in that context, because from an outside perspective, "trade" requires that everyone accept the currency being used, but it would be problematic, and "laughable", in that what if Saudi Arabia needs to buy Chinese exports? Would the Chinese exporters accept the Rupees? What could be the other uses of the Rupee? Can it be used to take positions in U.S./European based investments? It's going to be cumbersome, and it would definitely be easier to convert the Rupees to U.S. Dollars upon receipt because it's what everyone accepts. Including China.

Russia cannot continue to accept the rupee within a long-term contract because the rupee will accumulate, and it will not be able to use it. Even if it finds opportunities to exchange it for dollars, it will expose itself to “exchange risks.” In order for there to be an equation, Russian exports from India must be equal in value to India's exports from Russia. This is of course not possible because Indian imports from Russia far exceed Russian imports from it.
These initiatives cannot succeed, and in any case they will not affect the status of the dollar as long as everyone needs it. For the same reasons, the establishment of a unified currency cannot become a reality unless a trade balance is achieved between countries.

[usekevin]

The only reliable alternative as of now for US Dollar is gold. But then gold doesn't have enough liquidity or mobility to be used as a currency for international trade. With every other currency (including Euro, GBP, CNY or JPY), the same issues exist which are present with the US Dollar. My guess is that BRICS will never be able to get to an alternative for the USD. Each of the member nations want their own national currencies to replace the USD and to be used as an international trade currency. it will be difficult to get to a compromise deal that is acceptable to everyone.

The USD was the most needed one to India is my opinion,it may be the exact reason to buy the oil by using their fiat.India can easy print of their fiat,So it’s always easy compared to buy using their holding USD reserve.Mostly all the countries specially the developing country will do of hold the USD reserve for their future.The buying of the goods with rupees also increase the chance of new import to India by the way to spend their rupee which they get on the trad of oil.Surely it was good move by the Indian government.It can be used by some of other developing countries.

[arabspaceship123]

Petrodollar's going to be affected when growing countries flex financial muscles in rare oil trades using their currencies in petrodollars. That's a different prospect to trying to stop the dollar being the world currency in other trading.

The global demand for the USD is therefore high. But what if buying oil won't have to use the USD? It will certainly have an impact.

[romero121]

The only reliable alternative as of now for US Dollar is gold. But then gold doesn't have enough liquidity or mobility to be used as a currency for international trade. With every other currency (including Euro, GBP, CNY or JPY), the same issues exist which are present with the US Dollar. My guess is that BRICS will never be able to get to an alternative for the USD. Each of the member nations want their own national currencies to replace the USD and to be used as an international trade currency. it will be difficult to get to a compromise deal that is acceptable to everyone.

The USD was the most needed one to India is my opinion,it may be the exact reason to buy the oil by using their fiat.India can easy print of their fiat,So it’s always easy compared to buy using their holding USD reserve.Mostly all the countries specially the developing country will do of hold the USD reserve for their future.The buying of the goods with rupees also increase the chance of new import to India by the way to spend their rupee which they get on the trad of oil.Surely it was good move by the Indian government.It can be used by some of other developing countries.

This might be good for India, but beyond certain point Russia couldn't do anything with the Indian rupee. It can only make trade with India, so this is just a temporary plan. When something is done from the traditional process it needs to make changes to the economy, if not it needs to make changes to the living of people. Nothing is happening with the move from India, because the fuel price haven't changed as the country is getting it on big discount.

[blue Snow]

Can we say that trading using local currencies has become an attractive trend, especially with countries beginning to diversify their reserves, or is everything that is happening an attempt to put political pressure on the United States?

As we know, India is one of the BRICS members, and I think every step it made is not far away from the policy of another country. As far as I know, Not just this time They bought oil with the rupee, several years ago, they bought also from Russia and Iran, so with situation, I think this news is not so exciting to hear because they are used to doing that. maybe their economic policies do that to grow up their currency on the market or as a defense against the dollar rate.

[Sithara007]

The USD was the most needed one to India is my opinion,it may be the exact reason to buy the oil by using their fiat.India can easy print of their fiat,So it’s always easy compared to buy using their holding USD reserve.Mostly all the countries specially the developing country will do of hold the USD reserve for their future.The buying of the goods with rupees also increase the chance of new import to India by the way to spend their rupee which they get on the trad of oil.Surely it was good move by the Indian government.It can be used by some of other developing countries.

India won't be able to make much headway on this. UAE agreed for this one time deal, because Russia was selling cheaper crude oil to India and as a result the imports from UAE got negatively impacted. In the long-run, they are not going to prefer these sort of transactions, simply because the Indian Rupee is not yet fully convertible. And for other countries such as Pakistan and Indonesia, using their local currency for oil import is simply not possible. The oil exporters such as the United Arab Emirates or Saudi Arabia don't want to deal with these weak local currencies.

[arabspaceship123]

The dollar isn't going any where. Petrodollar's will remain the key currency for oil trading. OPEC isn't switching to a different currency. What we'll see once in a while's a country making a trade for oil using their currency to demonstrate their growing economic power. That's what happens.

[Wimex]

Historical background:

With the end of the "gold standard" where there was a fixed price for gold and every currency linked to the value of gold, the gold standard was abandoned in 1971, causing a free fall in the value of the dollar and an insane rise in inflation rates, the deal that arose in 1973 between the United States and Saudi Arabia Things returned to normal, and what is known as the petrodollar appeared to us, which includes pricing, trading and recycling of oil and the money generated from it in US dollars only.

I am not trying here to say that the system that created the petrodollar system may come to an end, but some changes have already begun to occur, as the Central Bank of India unveiled a new framework for settling global trade in rupees.

First, the two giants agreed to settle trade in their local currencies — in an effort to cut transaction costs and eliminate dollar conversions. They also agreed to set up a real-time payment link to simplify cross-border money transfers.

The agreements will enable “seamless cross-border transactions and payments, and foster greater economic cooperation,” the Reserve Bank of India explained in a recent statement.

https://finance.yahoo.com/news/dollar-being-dethroned-india-just-201500390.html?guccounter=1

Can we say that trading using local currencies has become an attractive trend, especially with countries beginning to diversify their reserves, or is everything that is happening an attempt to put political pressure on the United States?

One question - and what is the benefit of this deal ?
now the seller does not have 1 million barrels of oil, but has a lot of rupees, the liquidity of which is under great question.
There is another "perfect example" of such deals, and again there India. As you know - India is the biggest buyer of oil from an international terrorist country. And all the deals go through... you guessed it, in Rupees! In the end, only India benefits. But it is not because they are the most cunning, but because the terrorist country has no way out but to sell oil to India for pennies.
Bottom line: India got cheap oil. Russia got a lot of rupees. India refined the oil and made money. Russia... keeps the rupees - since they can't be used anywhere except to buy consumer goods in India. And russia needs the currency to buy necessary goods and technologies in the foreign market. But no one will sell them for rupees. And India has forbidden to exchange these rupees for dollars ) Does he understand the dubiousness of the benefits of working with local currencies ? And you can also model the situation as it was with the yuan - everything was fine, until the crisis began, and the yuan fell in value - what is the benefit of the party that sold for yuan for example 100 million barrels of oil ? Can't a crisis develop in India ? The dollar is more stable because it is "backed" by demand in the world economy....

Does he understand the dubiousness of the benefits of working with local currencies ?

Well, the dollar is actually part of this group of local currencies, only for a long time it has managed to earn the fame of being a potential asset for international payments, of course this is due to certain treaties and events that helped make it happen this way and now currently this is considered the most stable to carry out commercial exchanges, practically everyone makes use of it, the question now is that it seems that they want to replace it with other possible currencies that could be just as feasible, but according to the case that is exposed, what they caused is a stagnation for the recipient, it is definitely a situation that should be thought about a lot, now Russia is forced to buy from India and get out of those rupees,  what I can deduce from this, is that Perhaps they are looking for a way to destabilize the economy and create a new order where the dollar is no longer so essential, bringing imbalance to the United States directly.

[Wind_FURY]

I didn't mean "laughable" in that context, because from an outside perspective, "trade" requires that everyone accept the currency being used, but it would be problematic, and "laughable", in that what if Saudi Arabia needs to buy Chinese exports? Would the Chinese exporters accept the Rupees? What could be the other uses of the Rupee? Can it be used to take positions in U.S./European based investments? It's going to be cumbersome, and it would definitely be easier to convert the Rupees to U.S. Dollars upon receipt because it's what everyone accepts. Including China.

You are right, there are advantages to using the dollar as the world's universal reserve currency, which is why the dollar is so widely accepted around the world as the world's universal reserve currency. Unfortunately, the United States began to abuse its privileges by imposing unilateral sanctions right and left - which is why even in the recent past, loyal US allies are thinking about alternative options to reduce the political risks of using the dollar and not be left completely without money for already delivered oil.

That's true, but it doesn't change the fact that the U.S. Dollar is still the best in Spendability, Saveability and Liquidity. Therefore it made Saudi Arabia's acceptance of the Indian Rupee a losing trade than an advantageous one. They should have asked payment in U.S. Dollars.

[be.open]

I didn't mean "laughable" in that context, because from an outside perspective, "trade" requires that everyone accept the currency being used, but it would be problematic, and "laughable", in that what if Saudi Arabia needs to buy Chinese exports? Would the Chinese exporters accept the Rupees? What could be the other uses of the Rupee? Can it be used to take positions in U.S./European based investments? It's going to be cumbersome, and it would definitely be easier to convert the Rupees to U.S. Dollars upon receipt because it's what everyone accepts. Including China.

You are right, there are advantages to using the dollar as the world's universal reserve currency, which is why the dollar is so widely accepted around the world as the world's universal reserve currency. Unfortunately, the United States began to abuse its privileges by imposing unilateral sanctions right and left - which is why even in the recent past, loyal US allies are thinking about alternative options to reduce the political risks of using the dollar and not be left completely without money for already delivered oil.

That's true, but it doesn't change the fact that the U.S. Dollar is still the best in Spendability, Saveability and Liquidity. Therefore it made Saudi Arabia's acceptance of the Indian Rupee a losing trade than an advantageous one. They should have asked payment in U.S. Dollars.

Saudi Arabia is a sovereign state and they have the right to decide to whom they sell their oil and in what currency to take payment. One million barrels for Saudi Arabia is not that big of a deal to do a test trade in Indian rupees just to set a precedent and show the US that a half-century-old agreement to exclusively trade oil in dollars has lost its relevance due to changes in the geopolitical landscape.

[Wind_FURY]

I didn't mean "laughable" in that context, because from an outside perspective, "trade" requires that everyone accept the currency being used, but it would be problematic, and "laughable", in that what if Saudi Arabia needs to buy Chinese exports? Would the Chinese exporters accept the Rupees? What could be the other uses of the Rupee? Can it be used to take positions in U.S./European based investments? It's going to be cumbersome, and it would definitely be easier to convert the Rupees to U.S. Dollars upon receipt because it's what everyone accepts. Including China.

You are right, there are advantages to using the dollar as the world's universal reserve currency, which is why the dollar is so widely accepted around the world as the world's universal reserve currency. Unfortunately, the United States began to abuse its privileges by imposing unilateral sanctions right and left - which is why even in the recent past, loyal US allies are thinking about alternative options to reduce the political risks of using the dollar and not be left completely without money for already delivered oil.

That's true, but it doesn't change the fact that the U.S. Dollar is still the best in Spendability, Saveability and Liquidity. Therefore it made Saudi Arabia's acceptance of the Indian Rupee a losing trade than an advantageous one. They should have asked payment in U.S. Dollars.

Saudi Arabia is a sovereign state and they have the right to decide to whom they sell their oil and in what currency to take payment. One million barrels for Saudi Arabia is not that big of a deal to do a test trade in Indian rupees just to set a precedent and show the US that a half-century-old agreement to exclusively trade oil in dollars has lost its relevance due to changes in the geopolitical landscape.

No one was suggesting what Saudi Arabia should, or shouldn't do. I'm merely making a debate for the fact that trade requires efficiency, or else it won't be sustainable. And what's more capital efficient than using the U.S. Dollar for internationial trade? The BRICS nations will either be converting each other's currencies to the U.S. Dollar, or print their own currency like Europe. BUT issuing their own currency would be repeating the same cycle as the U.S. Dollar and the Euro all over again. If they want to break the United States' political stronghold, you know the technology is here and it's working.

[Jatiluhung]

I think recently, especially in 2023, many countries will carry out global transactions such as purchasing oil and others using their own local money. So India uses Rupee is just one of them. And actually things like this have been happening since last year and in previous years. It's just that in previous years news about this matter was not spread widely and did not attract too much attention to many people. Nowadays, news like this always appears at the top. Because currently the global economic situation or global competition in terms of the economy is indeed heating up a bit. So for me things like this are normal.