ABU DHABI, Aug. 19, 2026: The United Arab Emirates has halted all trade, commercial exchanges and financial transactions with Iran until further notice, marking a sharp deterioration in economic ties between the two neighbouring countries.
The UAE Ministry of Foreign Affairs announced the decision on Wednesday, citing what it described as regional escalation undermining regional and international peace and security. Afra Al Hameli, director of the ministry's Strategic Communications Department, said the suspension covered all trade, commercial exchanges and financial transactions with Iran.
مديرة الاتصال الإستراتيجي في وزارة الخارجية: وقف جميع الأنشطة والتبادلات التجارية والمعاملات المالية مع إيران
— MoFA وزارة الخارجية (@mofauae) August 18, 2026
Director of the Strategic Communications Department at MoFA: All Trade, Commercial Exchange, and Financial Transactions with Iran Halted pic.twitter.com/PQczXyDNRX
The announcement followed a missile alert in the UAE. The UAE Defence Ministry said its air-defence systems detected two ballistic missiles launched from Iran toward the country and assessed that they were targeting maritime traffic. The ministry said one missile fell into the sea outside UAE territorial waters and the other within them.
Iran has rejected the UAE's allegation that the missiles were launched from Iranian territory. Iranian Foreign Ministry spokesman Esmaeil Baqaei described the UAE's claim as baseless. Iran's state news agency IRNA reported the rejection on Wednesday.
The UAE's decision comes after months of tension involving Iran and several Gulf states, including repeated incidents affecting shipping and maritime traffic in and around the Strait of Hormuz. The UAE had previously condemned attacks on its vessels and other maritime targets, including an attack involving a UAE-linked tanker in the Strait of Hormuz earlier this month.
Despite the suspension, the UAE Foreign Ministry said Abu Dhabi remained committed to dialogue, cooperation and regional integration as means of advancing peace, stability and prosperity. Al Hameli also said the UAE remained committed to safeguarding the integrity of the international financial system in accordance with international law and global standards.
The decision represents a significant setback to economic relations between the UAE and Iran. The two countries have maintained substantial commercial links despite wider political tensions, making the suspension of trade, commercial exchange and financial transactions potentially significant for businesses and regional commerce.
Iran's rejection of the UAE's account means that the circumstances surrounding the missile incident remain disputed. The UAE's decision, however, is not disputed: Abu Dhabi has formally announced the suspension of economic and financial dealings with Tehran until further notice.
