UAE suspends trade with Iran after renewed missile fire
The United Arab Emirates suspended all trade with Iran on Wednesday after accusing Tehran of launching renewed missile attacks, adding to the economic pressure on Iran as it faces US sanctions and a blockade.
The UAE issued nationwide warnings on Tuesday night asking residents to take shelter after two ballistic missiles were fired toward the country. It was the first such warning in several weeks.
The UAE had faced frequent Iranian missile attacks earlier in the conflict, causing trade between the two countries to largely stop. Some maritime trade resumed in late June as fighting eased, according to Iran's state-run IRNA news agency, though the current level of trade was unclear.
UAE accuses Iran of missile attacks
The UAE Foreign Ministry said two ballistic missiles were fired toward the country on Tuesday and later fell into the Persian Gulf.
The ministry said it remained committed to dialogue and regional cooperation but had decided to suspend economic ties with Iran.
"All trade, commercial exchanges and financial transactions with Iran have been halted until further notice," it said, citing growing regional tensions.
The UAE Defense Ministry said its assessment showed that the missiles were aimed at maritime traffic. It was not immediately clear whether Emirati vessels or UAE territorial waters were directly targeted.
Iranian Foreign Ministry spokesperson Esmail Baghaei denied that Tehran had launched missiles toward the UAE.
Attacks on ships increase tensions
Iran has repeatedly targeted vessels using the Strait of Hormuz as part of its efforts to control the key waterway. Four tankers owned by Abu Dhabi's state oil company ADNOC have been attacked over the past two weeks.
The attacks caused no injuries but drew strong condemnation from the UAE and other Gulf countries, including Kuwait and Bahrain.
Nearly 20 ADNOC vessels have been attacked by Iranian missiles and drones in the Strait of Hormuz since the conflict began, killing one person and injuring about 20 others.
The strait is a major strategic point for Iran because about one-fifth of the world's traded oil and natural gas passed through it before the war.
The United States and Israel launched the conflict on Feb 28, with their stated objectives including weakening Tehran's government and ending its nuclear programme. However, the fighting has increasingly focused on control of the Strait of Hormuz.
Iran has fired hundreds of ballistic missiles and thousands of drones during the conflict. Tehran says many of the attacks targeted US assets, but some struck buildings and key infrastructure in Dubai and Abu Dhabi, including Dubai's airport, ports and energy facilities.
Iran has accused the UAE and other US allies in the Gulf of helping American military operations against Iran. DownloadingInteractive Geographic Maps
Iranian Chief of Staff Gen Ali Abdollahi issued a fresh warning Wednesday to countries along the southern coast of the Persian Gulf.
He said any assistance given to the US military would amount to taking part in American military operations, according to Iran's semiofficial Fars news agency.
Trade suspension could increase pressure on Iran
The UAE was one of Iran's largest trading partners before the war. According to the World Trade Organization's latest 2024 figures, the UAE accounted for more than 30% of Iran's imports, worth about $21 billion, and received nearly 13% of Iran's exports, valued at around $7 billion.
The UAE's decision comes as the United States prepares to impose further economic pressure on Iran.
US Treasury Secretary Scott Bessent said last week that the measures would combine economic isolation with the ongoing American blockade of Iranian ports.
The latest economic pressure follows heavy US and Israeli airstrikes on Iranian military, industrial and civilian infrastructure.
Iran's economy is already under severe strain. The International Monetary Fund expects inflation to reach nearly 70% this year and the economy to shrink by 5.4%. Iran's rial has also fallen to record lows.