UAE Warns of Possible Yuan Use in Oil Sales if Dollar Access Tightens During Iran Conflict

The United Arab Emirates has held discussions with the United States regarding potential emergency financial support if the ongoing regional conflict disrupts access to U.S. dollars. During meetings in Washington, Khaled Mohamed Balama raised the possibility of establishing a currency-swap line with Scott Bessent and officials from the Federal Reserve. Emirati representatives described the talks as precautionary but warned that prolonged conflict could pressure reserves and investor confidence.

Yuan Option Raised if Dollar Access Tightens

Officials noted that damage to energy infrastructure and disruptions to tanker routes through the Strait of Hormuz have limited oil exports, reducing a major source of dollar revenue. Emirati officials also cautioned that if dollar liquidity becomes constrained, the country may be forced to use alternative currencies such as the Chinese yuan for oil sales and financial transactions.

They emphasized that the request was presented as an early safeguard, warning that prolonged instability linked to military actions ordered by Donald Trump could threaten the nation’s financial stability and its role as a regional investment hub.

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