Dubai (Somalia Today) — The United Arab Emirates has agreed to unlock billions of dollars for Iran in a tactical shift after weeks of Iranian attacks on the wealthy Gulf state during Tehran’s war with the United States and Israel, four sources said.
The move, not previously reported, comes as Washington and Tehran enter the final stages of broader negotiations to end the war.
Diplomats say the talks could involve the release of tens of billions of dollars in Iranian oil revenues held in foreign banks under US sanctions.
Two regional sources told Reuters that the UAE had agreed to release $10 billion, with Iran already receiving more than $3 billion.
Two other sources with knowledge of the arrangement put the total at $20 billion, saying Abu Dhabi had agreed to the move in return for Iran halting missile and drone attacks on the UAE.
One source with knowledge of the arrangement also said Iran had already received a first tranche of $3 billion.
The UAE foreign ministry later issued a statement categorically denying reports of any transfer, including allegations involving $3 billion.
The ministry called the allegations “entirely false and unfounded”, adding that “no frozen Iranian funds have been released, transferred or facilitated through the UAE”.
Asked earlier by Reuters to comment on the reported transfer, a UAE official said Abu Dhabi was working to reduce tensions.
“The UAE’s foreign policy is guided by promoting de-escalation and reducing tensions across the region, while advancing lasting peace and stability,” the official said.
“The UAE supports efforts, including those undertaken by the United States, to protect the peoples of the region from the repercussions of conflict.”
US-Iran talks
The White House did not immediately respond to a request for comment.
In Washington, Vice President JD Vance said Friday that the United States would not release funds to Iran simply for signing a deal or attending a meeting.
He said any potential agreement would allow economic benefits to flow to Tehran only if Iran met its obligations.
Iranian authorities did not immediately respond to Reuters requests for comment.
The reported arrangement marks a sharp shift from the open hostility that shaped UAE-Iran relations through much of the war, when Iranian attacks emptied Dubai hotels, pushed some expatriates to leave and shook the sense of safety that underpins the UAE’s role as a global business hub.
One source with knowledge of the arrangement said the move offered a way to help end the conflict without forcing either Washington or Tehran to cross a red line.
Iran could claim it had secured compensation for war damage, Washington could insist it had paid nothing, and Abu Dhabi could protect its own security while safeguarding Dubai’s status as a regional hub, the source said.
Another source with knowledge of the arrangement said Iran had agreed, in return for the disbursement, to halt missile and drone attacks on the UAE.
The source said the deal would also help rebuild bilateral ties, including intelligence-sharing and economic cooperation.
Iran had approached at least two other Gulf Arab countries to seek similar arrangements, the source added.
None of the sources agreed to be identified because of the sensitivity of the matter.
Fujairah attack
The last known direct Iranian attack on the UAE came on May 4, when a strike hit Fujairah port on the Gulf of Oman.
The attack followed weeks of Iranian missile and drone strikes that pushed the UAE into one of its most serious security crises in years.
Abu Dhabi had earlier shut its embassy in Tehran and withdrawn its ambassador, accusing Iran of targeting civilian sites, airports, ports and energy infrastructure.
The escalation marked a sharp break from years of careful UAE efforts to keep channels open with Tehran, even as Abu Dhabi remained one of Washington’s closest Gulf partners.
One source with knowledge of the arrangement said talks began several weeks ago but accelerated after officials from Iran’s powerful Revolutionary Guards visited Abu Dhabi last week.
They met Sheikh Tahnoun bin Zayed Al Nahyan, the UAE national security adviser and deputy ruler of Abu Dhabi, and stayed at his guest house, the source said.
A UAE delegation then travelled to Tehran to negotiate details of the mechanism.
Dubai lifeline
The arrangement would unfold against a complex financial backdrop involving Dubai, the UAE’s main commercial hub and one of Iran’s most important economic lifelines.
Dubai’s banks have long held substantial Iranian-linked deposits, many of which US sanctions have immobilised.
Those sanctions police the global dollar-clearing system and expose foreign banks dealing with blacklisted Iranian entities to the risk of losing access to the American financial network.
In April, a senior Iranian source said Washington had agreed to release frozen Iranian assets held in Qatar and other foreign banks, though a US official quickly denied the assertion.
The source said unfreezing the assets was “directly linked to ensuring safe passage through the Strait of Hormuz”, one of the world’s most important oil shipping routes and a central issue in talks aimed at ending the conflict.
For the UAE, the reported arrangement underlines the pressure on Gulf states to shield their economies from a war that has repeatedly threatened energy routes, trade flows and investor confidence.
For Iran, it could provide badly needed access to funds after years of sanctions and months of war.
And for Washington, the challenge remains how to end the conflict without appearing to reward Tehran before it complies with any deal.
