India Prefers Use of UAE Dirham in Foreign Trade Settlement

A general view of residential apartments is pictured at Gurgaon, on the outskirts of New Delhi June 19, 2012. REUTERS/Parivartan Sharma/Files
A general view of residential apartments is pictured at Gurgaon, on the outskirts of New Delhi June 19, 2012. REUTERS/Parivartan Sharma/Files
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India Prefers Use of UAE Dirham in Foreign Trade Settlement

A general view of residential apartments is pictured at Gurgaon, on the outskirts of New Delhi June 19, 2012. REUTERS/Parivartan Sharma/Files
A general view of residential apartments is pictured at Gurgaon, on the outskirts of New Delhi June 19, 2012. REUTERS/Parivartan Sharma/Files

India has asked banks and traders to avoid using Chinese yuan to pay for Russian imports, three government officials involved in policy making and two banking sources said, because of long-running political differences with its neighbor.

India, which has emerged as a top buyer of Russian oil as well as discounted coal, would prefer the use of United Arab Emirates dirhams to settle trade, three government officials said.

One of the government officials directly involved in the matter said New Delhi is "not comfortable" with foreign trade settled in yuan but said settlement in "dirham is okay."

The second official said that India cannot allow settlement in yuan till the relations between the two countries improve.

For Indian refiners that in recent weeks started settling some Russian oil purchases in roubles, as Reuters reported, payments have been processed in part by the State Bank of India via its nostro roubles account in Russia.

But the bulk of the trade is still in other currencies as the rouble is partially convertible and the two countries are yet to finalize a framework.

All five officials declined to be named as discussions were private.



Europe Gas: Prices ease ahead of Trump-Putin phone call

Representation photo: Smoke is released from one of the chimneys of the Dora (Daura) Thermal Power Station in the Dora district in southern Baghdad on January 9, 2025. (Photo by AHMAD AL-RUBAYE / AFP)
Representation photo: Smoke is released from one of the chimneys of the Dora (Daura) Thermal Power Station in the Dora district in southern Baghdad on January 9, 2025. (Photo by AHMAD AL-RUBAYE / AFP)
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Europe Gas: Prices ease ahead of Trump-Putin phone call

Representation photo: Smoke is released from one of the chimneys of the Dora (Daura) Thermal Power Station in the Dora district in southern Baghdad on January 9, 2025. (Photo by AHMAD AL-RUBAYE / AFP)
Representation photo: Smoke is released from one of the chimneys of the Dora (Daura) Thermal Power Station in the Dora district in southern Baghdad on January 9, 2025. (Photo by AHMAD AL-RUBAYE / AFP)

Dutch and British wholesale gas prices eased on Tuesday morning as the market awaited any news on a potential peace deal between Russia and Ukraine but low storage levels remain a concern and weather forecasts are mixed.
The Dutch front-month contract inched down by 0.55 euro to 40.65 euros per megawatt hour (MWh) by 0917 GMT, LSEG data showed.
The Dutch May contract was down 0.68 euro at 40.57 euros/MWh, while the day-ahead contract eased by 0.20 euro to 40.80 euros/MWh, Reuters said.
In Britain, the day-ahead contract was down 1.01 pence at 101.75 pence per therm.
All eyes will be on the outcome of the call between US President Donald Trump and Russian President Vladimir Putin scheduled for 1300-1500 GMT and whether it may lead to a ceasefire in Ukraine, analysts at Energi Danmark said.
"Until then, the market is caught in uncertainty," they added.
Traders holding speculative long positions in the gas market have become nervous that a potential peace deal between Russia and Ukraine could see the resumption of some Russian pipeline gas into Europe, analysts at ING said in a note.
Meanwhile, fresh tensions in the Middle East, with new Israeli air strikes on Gaza, could provide some bullish market sentiment, said LSEG analyst Yuriy Onyshkiv.
"Later this week, warmer temperatures are expected but the long-term view still forecasts below seasonal normal levels which may continue to pressure gas storages," consultancy Auxilione said in its daily market report.
EU gas storage sites were last seen 34.84% full, compared with nearly 60% seen at the same time last year, data from Gas Infrastructure Europe showed.
In the European carbon market, the benchmark contract edged down by 0.12 euro to 69.99 euros a metric ton.