De-dollarization is most visible in commodity markets, where the greenback’s influence on pricing has diminished. “Today, a large and growing proportion of energy is being priced in non-dollar-denominated contracts,” said Natasha Kaneva, head of Global Commodities Strategy at J.P. Morgan.

For example, due to Western sanctions, Russian oil products exported eastward and southward are being sold in the local currencies of buyers, or in the currencies of countries Russia perceives as friendly. Among buyers, India, China and Turkey are all either using or seeking alternatives to the dollar. Saudi Arabia is also considering adding yuan-denominated futures contracts in the pricing model of Saudi Arabian oil, though progress has been slow.

Notably, cross-border trade settlement in yuan is gaining ground outside of oil too. Some Indian companies have started paying for Russian coal imports in yuan, even without the involvement of Chinese intermediaries. Bangladesh also recently decided to pay Russia for its 1.4 GW nuclear power plant in yuan.

“The de-dollarization trend in the commodity trade is a boon for countries like India, China, Brazil, Thailand and Indonesia, which can now not only buy oil at a discount, but also pay for it with their own local currencies,” Kaneva noted. “This reduces the need for precautionary reserves of U.S. dollars, U.S. Treasuries and oil, which might in turn free up capital to be deployed in growth-boosting domestic projects.”