Fragile thaw between Iran and the UAE shatters amid renewed tensions

Off the coast of Dubai (United Arab Emirates), July 31, 2026. AFP The brief period of détente between Iran and the United Arab Emirates appears to be coming to an end. On Tuesday, August 18, the wealthy Gulf federation announced it was suspending, "until further notice," all commercial and financial dealings with Tehran. This decision carries significant consequences for the Islamic Republic: after China, the UAE has been Iran's main trading partner and a crucial gateway to international markets, especially as the country faces strict international sanctions. "In light of regional escalations that undermine regional and international peace and security, all trade, commercial exchanges and financial transactions with Iran have been halted until further notice," the Emirati foreign ministry stated. Just hours earlier, the Emirati defense ministry had claimed that Iran fired two ballistic missiles toward the UAE, triggering an alert on residents' phones. This would be the first direct attack attributed to Tehran against the country since May. According to Emirati defense authorities, one missile landed outside territorial waters, while the second landed within them. The missile trajectories suggested they targeted maritime navigation rather than Emirati territory. Tehran denied firing at the UAE, with Esmail Baghaei, spokesperson for the Iranian foreign ministry, calling these "unfounded accusations" that undermined efforts to "build trust" between the two nations. You have 76.38% of this article left to read. The rest is for subscribers only.