Abu Dhabi National Oil Company and the Indian oil and gas company, Indian Oil Corporation Limited, have completed the first crude oil sale under the local currency payment system. This was announced by the Indian Embassy in the UAE.
The transaction involved the sale of approximately 1 million barrels of crude oil. Both Indian rupees and UAE dirhams were used for the transaction.
This is India’s first-ever local currency settlement with the UAE. Such transactions are expected to reduce transactional costs and the time required for transfers. The parties also hope that such settlements will increase the role of local currencies.
The Indian embassy also noted that, under the deal, traders can choose the currency of each payment by mutual agreement.