UAE Seeks Currency Swap with U.S. Amid Conflict Risks

Emirati officials warn they may have to use yuan or other currencies for oil sales if dollar shortage occurs.

Apr. 20, 2026 at 2:05pm

Got story updates? Submit your updates here. ›

A bold, abstract illustration composed of intersecting triangles and rectangles in shades of blue, red, and yellow, representing the complex economic and political dynamics between the UAE and the U.S. amid regional conflicts.As geopolitical risks rise, the UAE seeks a financial backstop from the U.S. to stabilize its economy.Washington Today

The United Arab Emirates has initiated discussions with the United States on securing a financial backstop, including the possibility of a currency-swap line, as the country faces economic fallout from regional tensions and disruptions to its oil and gas exports. UAE officials warned they may be forced to use the Chinese yuan or other currencies for oil sales if they experience a dollar shortage.

Why it matters

The UAE's request for a currency-swap line with the U.S. highlights the economic vulnerabilities the country faces due to the ongoing regional conflict. A shift away from using the U.S. dollar for oil sales could have broader implications for global energy markets and the status of the dollar as the world's reserve currency.

The details

UAE Central Bank Governor Khaled Mohamed Balama raised the idea of a currency-swap line with U.S. Treasury Secretary Scott Bessent, as well as with Treasury and Federal Reserve officials, during a visit to Washington, D.C. last week. Emirati officials said they had so far avoided the worst economic effects of the conflict but might still require a financial lifeline, as the conflict has damaged the UAE's oil and gas infrastructure and disrupted its ability to export oil through the Strait of Hormuz, depriving the country of a key source of dollar revenue.

  • Last week, Balama visited Washington, D.C. to discuss the currency-swap line proposal.

The players

Khaled Mohamed Balama

The governor of the UAE Central Bank.

Scott Bessent

The U.S. Treasury Secretary.

Got photos? Submit your photos here. ›

What’s next

The UAE and U.S. are expected to continue discussions on the potential currency-swap arrangement in the coming weeks.

The takeaway

The UAE's request for a currency-swap line with the U.S. highlights the economic vulnerabilities the country faces due to the ongoing regional conflict, and the potential for a shift away from using the U.S. dollar for oil sales which could have broader implications.