The US pressing sanctions on developing countries is making them cut ties with the dollar and look for alternative avenues. BRICS is filling in the void and helping other developing nations to survive without using the US dollar for trade. Sanctions might prove costly to the US as the world is looking at de-dollarization to strengthen its local currencies and native economies.
Also Read: What De-Dollarization? US Dollar Bulldozes BRICS Currencies
On the heels of de-dollarization and sanctions, a new country has officially ditched the US dollar for oil trade. The decision comes straight from the BRICS playbook of using local currencies for cross-border transactions and not the US dollar. Read here to know how many sectors in the US will be affected if BRICS ditches the dollar for trade.
Also Read: BRICS: India Accused of Dumping US Dollars To Keep Rupee From Falling
BRICS: Venezuela Ditches the US Dollar For Oil Trade
Venezuela’s state-run oil company PDVSA plans to use digital currencies to settle crude oil trade and not the US dollar. The move comes after the US reimposes sanctions on Venezuela making it harder for the Latin American country to trade. Also, the US made it difficult for the country to export crude oil and Venezuela is now looking at digital currency payments. Venezuela has also applied to join BRICS and is looking to be a part of the grouping.
Also Read: BRICS To Announce Membership of New Countries in 2024
“We have different currencies, according to what is stated in contracts,” said Venezuelan oil minister Pedro Tellechea to Reuters. He added that in some contracts, it is specified that payment methods will include digital currencies. Therefore, the US dollar will no longer be required to settle crude oil trade with Venezuela and is taking a leaf from BRICS ideals.
Venezuela formally submitted its application to join BRICS and is hoping to receive an invite during the October summit. The 16th summit is scheduled to take place in the Kazan region of Russia this year.
