The United Arab Emirates (UAE) is reportedly considering freezing billions of dollars in Iranian assets, a move that could have a severe impact on Tehran’s economy.
The potential action is a response to the escalating U.S-Iran-Israel war and could severely restrict Iran’s access to foreign currency and global trade networks. The UAE has traditionally served as a financial hub for Iranian businesses and individuals seeking refuge from Western sanctions, The Wall Street Journal reported on Thursday.
Emirati officials have reportedly warned Iran about the potential move, though it remains uncertain if or when the UAE will act. Proposed measures include freezing assets of UAE-based shell companies used to conceal trade and enforcing a broad crackdown on local currency exchanges.
Should the UAE move forward, accounts linked to the Islamic Revolutionary Guard Corps (IRGC) could be the primary target. Officials are also weighing direct maritime measures, including the seizure of Iranian vessels, aimed at disrupting Iran’s shadow fleet of oil tankers and intermediaries operating through Emirati ports and shipping routes.
Dubai’s free zones and informal exchange houses have long concealed Iranian oil and funds. The U.S. has long urged the UAE to dismantle certain networks and has sanctioned UAE-based entities in recent years.
The UAE Ministry of Foreign Affairs did not immediately respond to Benzinga‘s request for comments.
Iran Strikes Rattle UAE
This potential move by the UAE comes amid escalating tensions in the region. In retaliation for a U.S.–Israel joint attack, Iran launched over 1,000 drones and missiles at the UAE, striking Dubai International Airport, the Fairmont hotel, and various residential and tourist areas, causing significant damage to infrastructure. The UAE and Qatar have previously stated that Iran has “crossed a red line” with ongoing air strikes.
The UAE has strongly condemned an Iranian drone strike targeting Azerbaijan, labeling it a “dangerous escalation” and a “flagrant violation of state sovereignty,” according to a statement from the UAE’s Ministry of Foreign Affairs.
Furthermore, the Iranian attacks have unsettled Dubai’s expatriate business community and global investors, shaking confidence in the city’s long-standing reputation as a safe and stable hub. The freezing of Iranian assets could be seen as a further step in the UAE’s efforts to defend its regional security and stability.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by a Benzinga editor.
Image via Shutterstock
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