The White House is discussing whether to offer the United Arab Emirates a currency swap line after the U.S. war with Iran disrupted the Gulf state's economy, a White House official told CNBC, speaking on condition of anonymity.
The UAE has not formally requested a swap line, and no concrete plans are being drawn up. Still, the conversation has reached the administration's senior levels. A currency swap would give the UAE access to dollars from the Federal Reserve, helping it manage a liquidity crunch caused by Iran's closure of the Strait of Hormuz, which has choked off oil exports the country depends on for cash.
Iran has also fired missiles at U.S. regional allies, damaging economic infrastructure across the Gulf. The UAE, a close partner of the Trump administration, committed to invest more than $1 trillion in the United States last year, and its leaders have maintained close ties with President Trump since he returned to office.
Trump appeared open to the idea when asked on CNBC's "Squawk Box" Tuesday. "If I could help them, I would," he said. "It's been a good country. It's been a good ally of ours." A White House official framed the discussion more cautiously, describing it as "something we're thinking about considering."
The prospect carries political risk. U.S. consumers are already facing higher prices, and a dollar lifeline to a wealthy Gulf state could invite backlash. There is also a structural hurdle: the final decision on any swap line rests with the Federal Reserve, not the White House. Historically, the Fed has limited swap arrangements to major central banks and systemically important economies, making an extension to the UAE an unusual departure.
The Wall Street Journal, which first reported the swap line discussion, also reported that the UAE warned it may turn to the Chinese yuan for oil sales and other transactions if dollars become scarce, a development that would threaten the dollar's long-standing dominance in global oil markets. The UAE's embassy in Washington disputed that characterization in a statement posted to X.
