UAE denies reports it agreed to release frozen Iranian assets

• UAE foreign ministry rejects transfer claims.
• Reuters cites four unnamed sources.
• Alleged deal involved up to $20bn.

The United Arab Emirates (UAE) has denied media reports alleging that the government agreed to release up to $20 billion in frozen assets to Iran, with its foreign ministry saying claims that Iranian funds had been released were "entirely false and unfounded".

The UAE foreign ministry issued a statement early on Saturday categorically denying reports of the transfer, "including allegations concerning $3 billion".

The statement "affirmed that these allegations are entirely false and unfounded, stressing that no frozen Iranian funds have been released, transferred or facilitated through the UAE.

The statement did not provide any further specifics.

The denial came after Reuters reported that the UAE had agreed to unlock billions of dollars for Iran, citing four sources, in what it described as a tactical shift after weeks of Iranian attacks on the wealthy Gulf Arab state during the US-Israeli war with the Islamic Republic.

Word of the reported move by the UAE to seek de-escalation, which had not been previously reported, coincided with the final stages of broader negotiations between Tehran and Washington on ending the war, talks that diplomats say could involve the release of tens of billions of dollars in Iranian oil revenues frozen in foreign banks under US sanctions.

In the past month, the UAE, which was heavily targeted by Iran at the height of the war, has been spared fresh strikes, while Iran has trained its missiles and drones on Kuwait and Bahrain. 

The last known direct attack by Iran on the UAE was more than a month ago — a May 4 strike on the Gulf state's Fujairah port on the Gulf of Oman.

Two regional sources told Reuters the UAE had agreed to release a total of $10 billion, more than $3 billion of which had already been delivered.

Two other sources with knowledge of the arrangement put the total funds involved at $20 billion, claiming that the move had been agreed in return for a halt to Iranian attacks on the UAE.

One of the sources with knowledge of the arrangement also said a first tranche of $3 billion had already been made available.

Reuters could not establish whether the funds earmarked for the transfers belong to the UAE or originate in long-blocked Iranian accounts in the UAE banking system, or elsewhere.

Earlier, when asked by Reuters to comment on the transfer, a UAE official said the country was trying to ease tension and foster peace.

"The UAE's foreign policy is guided by promoting de-escalation and reducing tensions across the region, while advancing lasting peace and stability," the official said. "The UAE supports efforts, including those undertaken by the United States, to protect the peoples of the region from the repercussions of conflict."

The White House did not immediately respond to a request for comment on the move.

In Washington, Vice President JD Vance said on Friday that funds would not be released to Iran for signing a deal with the US or attending a meeting, adding that the potential deal is structured to ensure that economic benefits would flow to Tehran if it meets its obligations.

There was no immediate response from Iranian authorities to a Reuters request for comment on the move.

None of the sources cited in the Reuters report agreed to be identified due to the sensitivity of the matter.

One of the sources with knowledge of the arrangement said the move offered a way to help solve the conflict between the US and Iran without either side crossing its red line: Iran can claim it extracted compensation for war damages, Washington can insist it paid nothing while framing the move as an investment in rebuilding regional trust.

The source added that Iran had approached at least two other Gulf Arab countries to make a similar arrangement.

On April 11, a senior Iranian source said that the US had agreed to release Iranian frozen assets held in Qatar and other foreign banks, although a US official swiftly denied the assertion.

The source, who declined to be named due to the sensitivity of the matter, told Reuters that unfreezing the assets was "directly linked to ensuring safe passage through the Strait of Hormuz", a key issue in talks aimed at ending the conflict.