The United Arab Emirates has said it is suspending all trade and financial dealings with Iran after reporting an Iranian missile attack directed at its ships.

The announcement comes after a period of relative calm in the UAE, with no Iranian missiles aimed at the country since May after it bore the brunt of attacks in the early weeks of the Middle East war.

Abu Dhabi has however accused Tehran of repeatedly targeting its tankers at sea in recent weeks.

"In light of regional escalations... all trade, commercial exchanges, and financial transactions with Iran have been halted until further notice," said UAE foreign ministry communications director Afra Al Hameli.

The UAE is home to a sizeable Iranian community and has been a major trading partner for US-sanctioned Iran, at least before the war.

They share deep cultural and historical ties as neighbouring countries across the Gulf, with centuries-old links between coastal communities, trade routes and family networks.

Tuesday's announcement is the latest measure against Iran by the UAE after it recalled its ambassador early in the conflict and shut Iran-linked schools and a hospital. (AFP)


Edited by Aaron Tam