UAE mulls freezing Iranian assets as Middle East conflict escalates: WSJ

The United Arab Emirates is considering cutting off Iran’s access to billions of dollars held in the Gulf country. The Wall Street Journal reported Thursday.

The move could disrupt Tehran’s access to foreign exchange and global trade networks at a time when its economy is deteriorating and the military conflict with the United States and Israel is adding further pressure.

Emirati officials had warned Iranian officials that such a move was being considered, but no decision had been reached on whether or when action would be taken, the newspaper said, citing people familiar with the discussions.

The UAE has long sought to balance its strategic alliance with the United States and neighbor Iran, but Tehran’s attacks on the Gulf nation appear to be prompting a rethink in policy.

Dubai, the capital of the UAE critical financial corridor For Iranian businesses and individuals seeking to circumvent Western sanctions, selling oil abroad and funneling revenues to military programs and regional proxies, according to the US-based think tank Atlantic Council.

Shell companies registered in Dubai’s sprawling free zones have concealed the origin of Iranian oil and commodities for years. Informal exchange offices also moved funds beyond the reach of traditional banking supervision.

America is pressuring the Gulf country to dismantle these networks. US Treasury imposes sanctions on UAE-based entities In recent years, officials reiterate that sanctions in the UAE have increased The country fell short of its stated commitments.

In retaliation for the joint US-Israeli attack, Iran targeted: More than 1,000 drones and missiles Attacks against targets in the UAE are damaging residential and tourist areas as well as infrastructure, including Dubai International Airport and the popular Fairmont hotel.

Earlier this week, UAE officials They confirmed their stance Not participating in military action against Iran and taking a defensive stance. In a statement, the foreign ministry said the decision was consistent with “the long-standing policy of good neighbourhood, de-escalation and strict adherence to the United Nations Charter”.

Iran’s attacks have shaken the foreign business community and international investors that Dubai has spent decades cultivating, reflecting stability in an unstable neighbourhood.

According to the Journal, Emirati officials are currently examining a range of potential countermeasures, including freezing the assets of UAE-based shell companies and a sweeping financial crackdown on local foreign exchanges that are at the center of Iran’s financial apparatus.