In an apparent attempt, at least in part, to avoid the reach of Western sanctions, Russia‘s state-owned energy companies Bashneft, Rosneft, Gazprom, and Gazprom Neft have been increasing their use of renminbi (RMB) and Hong Kong dollar accounts for settlements with Asian clients.
In October 2015, Bashneft (which had its shares seized by the state in 2014) issued four tenders to open renminbi accounts. One was opened with Sberbank and another with Gazprombank, each approximately $28 million, 20-year term placements. Two much larger accounts valued at $14 billion, were reportedly opened with Rosbank. Gazprom currently holds two RMB accounts with Gazprombank — a settlement and a transit account — and Gazprom Neft began selling oil abroad for RMB in May of 2014. Rosneft has likewise stepped up its use of RMB settlement services since January 2015.
In addition to other possible benefits, use of RMB accounts is viewed by state-owned enterprises as a means to protect themselves from sanctions (with most of the above-named entities having been targeted by sanctions since the start of the Ukraine crisis).
Russian energy companies are increasingly looking to the Asian market. Although it is natural for the use of the RMB to play a greater role as a result, there is general acknowledgment of the national security benefits that accompany an expedited move in this direction. Putin himself has voiced his desire for Russian companies to end their reliance on the U.S. dollar and move towards greater use of RMB and the Ruble.