Switching to local currencies: How BRICS and European countries are transforming energy trade

The global energy settlement system is undergoing a fundamental transformation. BRICS countries and European nations are increasingly moving away from the US dollar in favor of local currencies in trade transactions. According to data from NS3.AI, approximately 20% of current oil transactions are now conducted in domestic currencies, marking a clear shift in international energy trade.

New currencies at the center of trade: petro-yuan, ruble, and rupee

The transformation has a concrete manifestation. China is steadily promoting the petro-yuan as an alternative for energy settlements, while Russia and India are systematically implementing payments in rubles and rupees. These initiatives are not isolated experiments—they represent a coordinated strategy by BRICS countries to reduce dependence on the dollar in commodity trade.

European countries are observing these moves with interest, and some European nations are beginning to explore the possibility of using euros and local currencies in energy agreements. This change reflects a broader geopolitical trend—the imperial influence of petrodollars is gradually eroding.

Dynamics of change: from hegemony to multipolarity

Although the US dollar still dominates global energy trade, its position is gradually weakening. Significant volumes of energy transactions managed by BRICS countries and the increasing participation of European nations in alternative settlement systems are creating a new reality. This shift is driven not only by economic considerations but also by geopolitical changes that accelerate the decarbonization of petrodollars.

The long-term outlook suggests that the traditional economic order, based on the hegemony of reserve currencies, is shifting toward a more diversified system. For European countries and the rest of the world, this presents new opportunities in trade relations and financial independence.