UAE halts all trade ties with Iran after missile attack

The United Arab Emirates blamed Iran for launching missiles near the country on Tuesday, marking the first such attack since May. The Iranian Foreign Ministry denied responsibility for the attack. 

The UAE Defense Ministry said around 9 p.m. local time (1 p.m. EDT) that it “detected two ballistic missiles launched from Iran toward the country.” The first missile fell in Emirati territorial waters, while the second fell in international waters, the ministry said in a post on X. 

The ministry later said that the two missiles were targeting "maritime navigation." 

Tehran denied responsibility for the attack late Tuesday, local time. 

In response, however, the UAE Foreign Ministry said in a statement that “all trade, commercial exchanges and financial transactions with Iran have been halted until further notice.”

The ministry said the move was in response to “regional escalations,” adding that the UAE remains committed to dialogue and cooperation.

Why it matters: The UAE was targeted by Iran more than any other Gulf state during the initial phase of the US-Israel-Iran war from late February until the April ceasefire, a result of Abu Dhabi’s economic prowess, geographic proximity and close ties to the United States and Israel. 

Tuesday’s incident follows the targeting of Emirati vessels in the Strait of Hormuz in the last few days. UAE state media reported on Saturday that Iran had attacked an Abu Dhabi National Oil Company vessel in the waterway a day earlier, the third such incident involving an ADNOC vessel in less than a week. 

Iran did not comment on the targeting of the ships, but it has warned vessels to use the route set by Iran in the strait, saying it will strike those that do not comply or are linked to enemy states. 

The UAE previously reported a missile attack on July 12, but later said the threats were outside the country's borders. On May 4, the UAE said it confronted missiles and drones fired from Iran.

Senior government adviser Anwar Gargash said on X last week that the Gulf state will defend its “rights to freedom of navigation” in Hormuz following the strikes on the ADNOC vessels. 

The Wall Street Journal reported in May that the UAE had been secretly carrying out attacks on Iran during the war. 

UAE Foreign Minister Abdullah bin Zayed held a phone call with his Iranian counterpart, Abbas Araghchi, in June. The conversation focused on regional developments and was the first and only call between the two diplomats since the war began. 

Know more: Emirati President Sheikh Mohammed bin Zayed met the Sultan of Oman Haitham bin Tariq in Abu Dhabi on Monday to discuss regional developments. The meeting came as Iran said the same day that it had reached an agreement with Oman over a new shipping route through the Strait of Hormuz. 

This is a developing story and has been updated since publication.