The United Arab Emirates has agreed to release billions of dollars to Iran, marking a tactical shift after weeks of Iranian attacks on the wealthy Gulf state, four sources said.
The move coincides with broader talks between Tehran and Washington to end the war. Diplomats said the negotiations discuss unfreezing tens of billions of dollars in oil revenues that Iran has frozen in foreign banks under US sanctions.
Two regional sources said the UAE agreed to release a total of $10 billion, with more than $3 billion already transferred. Two other sources familiar with the deal said the total amount involved could reach $20 billion and that the move was made in exchange for Iran halting attacks on the UAE.
A source with knowledge of the matter said the first $3 billion tranche has been disbursed. Reuters could not verify whether this sum belongs to the UAE or stems from long-frozen Iranian accounts in the UAE banking system.
“The UAE’s foreign policy aims to promote de-escalation and reduce tensions in the region, while fostering lasting peace and stability,” a UAE official said. “The UAE supports efforts, including those by the US, to protect people in the region from the consequences of conflict.”
US Vice President JD Vance said the frozen funds would not be released immediately to Iran upon signing any deal, but the potential agreement is structured to ensure economic benefits flow to Tehran if it meets its obligations.
The deal marks a notable shift from the open hostility in UAE-Iran relations for much of the war, when Iranian attacks emptied Dubai hotels, prompted many expatriates to leave, and shook the country's reputation for safety.
One source said the agreement helps resolve the US-Iran conflict without either side crossing its red lines: Iran can claim war reparations, while Washington can stress it has not spent a cent. Abu Dhabi gains its own security and protects Dubai’s position as a hub.
Another source said that in exchange for the disbursement, Iran would halt missile and drone attacks on the UAE, and the two sides would rebuild bilateral relations, including intelligence sharing and economic cooperation. The source added that Iran has approached at least two other Gulf Arab states with similar deals.
The last known direct Iranian attack on the UAE was over a month ago — a strike on the port of Fujairah in the Gulf of Oman on May 4. Talks began several weeks earlier but accelerated when Iranian Revolutionary Guard officials traveled to Abu Dhabi to meet Sheikh Tahnoun bin Zayed al Nahyan, the UAE’s national security adviser. That trip was followed by a visit from UAE officials to Tehran to negotiate the mechanism details.
Dubai banks have long held large deposits linked to Iran, mostly frozen under US sanctions. On April 11, an Iranian senior source said the US had agreed to release Iran’s frozen assets in Qatar and other foreign banks, though a US official quickly denied it.
