Cutting Iran off completely from the UAE could deal a serious blow to the Islamic Republic’s economy — but experts say disentangling the pair’s commercial ties could prove difficult.
The UAE was Iran’s largest source of imports before the war, ahead of China, with two-way trade worth roughly $28 billion in 2024, according to the World Trade Organization. Further disruption could weaken the rial, push inflation toward triple digits, and deepen an economic contraction currently estimated at 5%, a former Iranian central bank adviser told CNBC.
Washington is convinced of the role the UAE can play in choking Iran’s economy: The US told Emirati officials that targeting IRGC-linked money flows would hit Tehran harder than the naval blockade of Iranian ports, according to The Wall Street Journal.
US sanctions orders show oil revenues, foreign-currency trades, and payments for Iranian entities historically moving through shell companies and exchange houses in Dubai, often with no Iranian name on the transaction, the Journal reported.