The United Arab Emirates has announced the suspension of all trade, commercial exchanges and financial transactions with Iran, following what it described as an Iranian missile attack targeting Emirati ships.
The decision marks a significant escalation in tensions between the two Gulf neighbours after a period of relative calm. The UAE had not reported Iranian missiles being directed at its territory since May, although Abu Dhabi has accused Tehran of repeatedly targeting Emirati tankers at sea in recent weeks.
“In light of regional escalations… all trade, commercial exchanges, and financial transactions with Iran have been halted until further notice,” UAE Foreign Ministry communications director Afra Al Hameli said.
The measure could have considerable economic implications given the historically extensive commercial relationship between the two countries. The UAE has long been one of Iran’s major trading partners, while also hosting a sizeable Iranian community.
Despite political differences, Iran and the UAE share longstanding cultural, commercial and family connections developed over centuries of interaction between communities on opposite sides of the Gulf.
The latest restrictions follow several measures introduced by Abu Dhabi since the outbreak of the Middle East conflict. The UAE recalled its ambassador to Iran early in the war and subsequently ordered the closure of several Iran-linked institutions.
During heightened tensions in March, authorities closed an Iranian state-linked hospital in Dubai, as well as schools and a community centre associated with Iran.
At the time, a UAE official said institutions directly connected to the Iranian government and Islamic Revolutionary Guard Corps (IRGC) would face targeted measures where authorities determined that UAE laws had been violated.
The suspension of commercial and financial ties represents one of the UAE’s most significant economic measures against Iran since the conflict began.