BRICS Nations' $265M Crypto Oil Deal: Russia & South Africa Ditch US Dollar

• BRICS Members Russia and South Africa Discard US Dollar in Significant Oil Deal
• BRICS Persistently Pushes for De-Dollarization
• Local Currency To Be Embraced?
• Expansion of the BRICS Bloc

BRICS Members Russia and South Africa Discard US Dollar in Significant Oil Deal

Marking a significant move in the broader de-dollarization efforts of the BRICS alliance, Russia and South Africa recently concluded a historic $265 million oil deal, excluding the use of the US Dollar. In this momentous agreement, Gazprombank, a Russian enterprise, is identified as the chosen investor for the extensive gas refinery contract. While the particular currency employed in the contract is yet to be declared, the bank's existence under US sanctions indicates a probable use of local currencies. This decision comes as the alliance intensifies its collaboration with Russian financial establishments in response to the sanctions.

BRICS Persistently Pushes for De-Dollarization

In the past few months, the BRICS bloc has made de-dollarization the crux of its strategies. The alliance has unwaveringly advocated for the adoption of local currencies. The necessity of such measures has been amplified in light of the sanctions imposed on Russia following its invasion of Ukraine.

The alliance now seems to have taken another step towards its de-dollarization goal. South Africa and Russia, key members of the BRICS, have agreed to abandon the US dollar in a significant $265 million oil deal. Gazprombank of Russia is the chosen partner for a new gas refinery agreement. According to various reports, Gazprombank was picked from a group of 20 contenders, with 19 being eliminated due to a technicality.

Local Currency To Be Embraced?

While it remains unclear which currency the deal is to be transacted in, various indicators suggest that the local currency will be employed. The bank in question faces US sanctions which have resulted in Russia's diminished use of the dollar. As a result, such transactions have assisted the nation in mitigating the impact of these sanctions and establishing commercial connections elsewhere.

Expansion of the BRICS Bloc

The BRICS bloc has had an impressive run this year, especially considering its overall expansion. During its 2023 Annual Summit held in August, the alliance agreed to a six-country expansion strategy. This included welcoming nations such as Saudi Arabia and the United Arab Emirates (UAE) into its operations.

Edited by Jonathan Stoker