Juan Cole reports that Reuters reports that China is establishing a commodities futures market in Shanghai that will operate in yuan/rmb. According to the report the commodity that is most expected to be traded is crude petroleum. This will put this exchange in competition with the West Texas intermediate crude market, the London-based Brent crude market, and the Dubai market, all of which operate in US dollars.
Supposedly a main motive for establishing this market is to provide an outlet for Iranian oil for nations that want to buy it without facing sanctions from the United States after November 1. Some might argue that this will not work as oil is and has always been priced in dollars. However, in fact there have been oil deals in other currencies, even if there have not been organized regular markets doing so. However, in this case purchases by China of crude oil should be sufficiently great to provide a basis for such a market to develop. How many other nations will take advantage of this to circumvent the sanctions of the Trump administration remains to be seen.