Iran, a Decision That Is Likely to Deepen the Islamic Republic's Economic Isolation As It Faces Mounting Pressure From the United States

The UAE said "escalations that undermine regional and international peace and security" prompted the move. The UAE has served as a major financial and business hub for Iranians and has in recent years been Iran's biggest trading partner, with billions of dollars in goods imported annually. The loss of this vital trade link is expected to exacerbate the economic strain on Tehran as Washington ramps up pressure amid escalating tensions.

The decision follows a missile threat alert sent to residents in Dubai on Tuesday evening. The UAE's defense ministry later said the alert was triggered by two ballistic missiles fired from Iran targeting maritime traffic.