Iran Considering limited Tanker Passage Through Strait Of Hormuz If Cargo Paid In Yuan: Report

Iran is considering allowing a limited number of oil tankers to pass through the Strait of Hormuz on the condition that the cargo is traded in Chinese yuan, a senior Iranian official told CNN on Friday.

The official said the potential move is part of Tehran’s plan to manage the flow of oil tankers through the strategic waterway.

Global oil is predominantly traded in US dollars, except for sanctioned Russian oil, which is priced in rubles or the yuan, said CNN, adding that China has sought for years to expand the use of yuan in oil transactions, but the dollar remains the world’s primary reserve currency.

Concerns about disruptions in the strait, a critical route for the world’s energy supply, have pushed oil prices to their highest since July 2022, following the start of the Russian-Ukranian conflict that began earlier that year, it said.

The Strait of Hormuz carries about 20 million barrels of oil a day and roughly 20% of the global liquefied natural gas trade.

The UN warned on Friday that restrictions on shipping through the strait could have a “massive impact” on humanitarian operations in the region.

Tehran has effectively closed the Strait of Hormuz since March 1, following Israel and the US launching joint attacks against Iran on Feb. 28, which have so far killed around 1,300 people, including then-Supreme Leader Ayatollah Ali Khamenei. Hostilities have since escalated.