Bessent says ‘many’ allies have asked for currency swaps amid Iran war
U.S. Treasury Secretary Scott Bessent arrives to testify during a Senate Appropriations Committee, Financial Services Subcommittee and General Government hearing at the Dirksen Senate Office Building in Washington, DC on April 22, 2026.
Chip Somodevilla | Getty Images
Treasury Secretary Scott Bessent said Wednesday that “many” oil-rich U.S. allies in the Persian Gulf are demanding a fiscal boost amid economic turbulence from the war with Iran.
Bessent’s comments go beyond allegations the White House told CNBC on Tuesday, when an official said the United States had not yet been formally asked by the United Arab Emirates to establish a currency exchange line, only that there had been discussions on the subject.
Such a swap line would provide liquidity in the market to the UAE or other Gulf countries. US dollar, but it becomes fraught with political risk as U.S. consumers are exposed to war-induced high prices for food, gas and other daily purchases.
“Many of our allies in the Gulf have requested a clearing line,” Bessent said. “Whether from the Federal Reserve or the Treasury, swap lines are meant to maintain order in dollar funding markets and prevent disorderly sales of U.S. assets.”
“The swap line will benefit both the UAE and the US and, as I said, many other countries, including some of our Asian allies.” [who] “We also requested these without specifying which other countries they were from,” he said.
Gulf countries, including the UAE, were hit hard by the war with Iran. Tehran damaged economic infrastructure by firing missiles at US allies in the region. Iran’s closure of the Strait of Hormuz also restricted oil revenues, which are critical for the Gulf countries.
Currency swaps may also be necessary to ensure that the US dollar, which dominates nearly all oil exchanges, remains in use.
President Donald Trump said on CNBC’s “Squawk Box” on Tuesday that he wants to help the UAE if possible.
“If I could help them, I would,” the president said.
Sen. Steve Daines, R-Mont., who serves on both the Senate Finance and Foreign Relations committees, supported a currency swap with the UAE in an interview with CNBC on Tuesday.
Daines said he thought “[Bessent] “He’s moving in that direction and I support him in that.”
But Democrats are likely to benefit from the political opening resulting from currency swaps, especially with rich countries in the Middle East. The UAE has one of the highest per capita incomes in the world.
Sen. Chris Van Hollen, D-Md., who asked Bessent about the possible currency swap at the hearing, highlighted the local economic conditions under which the swap could occur.
“The war in Iran has already cost us a lot. We’re talking about a billion dollars a day in taxpayers’ money, on top of lost lives, we’re talking about higher gas prices, higher prices in general, and now we understand that the UAE wants you to provide them with a clearing line through the Exchange Stabilization Fund,” Van Hollen said.
Van Hollen also noted the abundance of recent reports regarding the UAE-US relationship, including the Gulf country’s government’s investments in the Trump family’s businesses and the easing of protections around advanced artificial intelligence chips.
— CNBC’s Megan Cassella contributed to this report.
