In a tactical change following weeks of Iranian attacks on the affluent Gulf Arab state during the US-Israeli conflict with the Islamic Republic, the United Arab Emirates has agreed to unlock billions of cash for Iran, according to four sources.

The final stages of larger negotiations between Tehran and Washington on ending the war, which diplomats say may involve the release of tens of billions of dollars in Iranian oil revenues frozen in foreign banks under US sanctions, coincide with news of the UAE’s move to seek de-escalation, which has not been previously reported.

Iran has trained its missiles and drones on Kuwait and Bahrain, but the UAE, which was frequently targeted by Iran during the height of the conflict, has not seen any new attacks in the last month. More than a month has passed since Iran’s most recent documented direct attack on the United Arab Emirates, which targeted the Gulf state’s Fujairah port on the Gulf of Oman on May 4.

Over $3 billion of the $10 billion that the UAE had pledged to release has already been released, according to two regional sources who spoke with Reuters.

The total amount of money involved, according to two other persons with knowledge of the deal, was $20 billion. They also stated that the action was agreed upon in exchange for an end to Iranian strikes on the United Arab Emirates.

A first tranche of $3 billion has already been made available, according to one of the sources with knowledge of the agreement.

Reuters was unable to determine if the money designated for the transfers came from Iranian accounts that had been barred for a long time in the UAE banking system or from another source.

Reports of the transfer, “including allegations concerning $3 billion,” were firmly denied by the UAE foreign ministry in a statement released early on Saturday.

No blocked Iranian monies have been freed, moved, or facilitated through the UAE, according to the UAE statement, which “affirmed that these allegations are entirely false and unfounded.”

No other details were included in the UAE statement.

A UAE official previously stated that the nation was attempting to reduce tension and promote peace when Reuters contacted them to comment on the transfer.According to the source, “the UAE’s foreign policy is guided by promoting de-escalation and reducing tensions across the region while advancing lasting peace and stability.” “The UAE supports efforts, including those undertaken by the United States, to protect the peoples of the region from the repercussions of conflict.”

against May 4, Iran launched its most recent direct attack against the UAE.

A request for comment on the action was not immediately answered by the White House.

Vice President JD Vance stated in Washington on Friday that Iran will not receive money for attending a meeting or striking a contract with the United States. He added that the proposed agreement is set up to guarantee that Tehran would receive financial rewards if it fulfils its commitments.

Reuters asked Iranian authorities for comment on the action, but they did not immediately respond.

Because of the delicate nature of the subject, none of the sources included in this piece would consent to be identified.

The agreement marks a dramatic change from the open hostility that characterised UAE-Iran ties during the majority of the war, when Iranian attacks destroyed Dubai’s hotels, forced some foreigners to leave, and damaged the reputation for safety that is essential to the nation’s standing as a top business hub.

According to one of the people with knowledge of the arrangement, the move offered a way to help resolve the conflict between the US and Iran without either side going over its red line: Abu Dhabi gets its own security and Dubai’s hub status, Washington can insist it paid nothing, and Iran can claim it extracted compensation for war damages, all while framing the move as an investment in restoring regional trust.

According to the other source with knowledge of the agreement, Iran will stop attacking the United Arab Emirates with missiles and drones in exchange for the payment, and bilateral relations would be restored, including economic cooperation and intelligence sharing.

According to the source, Iran had made similar arrangements with at least two other Gulf Arab nations.

According to the first person with knowledge of the arrangement, negotiations had begun a few weeks ago but accelerated when representatives of Iran’s formidable Revolutionary Guards travelled to Abu Dhabi last week to meet Sheikh Tahnoun bin Zayed al Nahyan, the deputy ruler of Abu Dhabi and national security adviser of the United Arab Emirates, and stayed at his guest house.

UAE officials then travelled to Tehran to negotiate the mechanism’s specifics.

DUBAI’S SIZEABLE IRANIAN ASSETS

The UAE-Iranian agreement is expected to take place in a complicated financial environment that may involve Dubai, the primary commercial center of the UAE and one of Tehran’s most vital economic lifelines.

Due to US sanctions that monitor the worldwide dollar-clearing system and put foreign banks that deal with Iranian firms on the blacklist at risk of being shut off from the US financial network, Dubai’s banks have long held significant Iranian-linked deposits, many of which are now immobilised.

A US official quickly refuted a senior Iranian source’s claim on April 11 that the US had agreed to release Iranian blocked assets held in Qatar and other international institutions.

Unfreezing the assets was “directly linked to ensuring safe passage through the Strait of Hormuz,” a crucial issue in negotiations aimed at resolving the crisis, according to the source, who chose not to be named owing to the delicate nature of the situation.