The launch of the oil futures denominated in China''s renminbi currency, also known as the yuan, is China''s first commodity derivative open to foreign investors. This marked the culmination of a decade-long push by the Shanghai Futures Exchange (ShFE) to give the world''s largest energy consumer more power in pricing crude sold to Asia. Already on Monday, Unipec, the trading arm of Asia''s largest refiner Sinopec, has inked a deal with a western oil major to buy Middle East crude priced against the newly-launched Shanghai crude futures contract.
This helps cement the exchange''s viability and challenges the petro-dollar system, in which oil deals are executed in dollars. This would decrease demand for the greenback and boost U.S. inflation.