President Donald Trump told reporters in Washington on Tuesday that the United States is considering helping the United Arab Emirates financially and that a currency swap with the UAE "was under consideration." His comments landed as the Gulf state weighs backup plans after weeks of fighting in the region that have disrupted oil flows and strained access to dollars.
What Trump Said
According to Reuters, Trump said the United States was "considering helping" the UAE financially and described a currency swap as "under consideration" during remarks in Washington. Reuters reported that the comments came as U.S. and Gulf officials were discussing possible financial backstops while the Iran conflict unsettles regional markets.
UAE Talks Were Raised In Washington
The Wall Street Journal reported that UAE Central Bank Governor Khaled Mohamed Balama floated the idea of a currency-swap line in meetings with Treasury Secretary Scott Bessent and Federal Reserve officials in Washington last week. The Wall Street Journal said Emirati officials presented the talks as precautionary and emphasized that no formal request had been made.
White House Reaction
White House National Economic Council Director Kevin Hassett told CNBC the United States would "make every effort" to assist the UAE but added that a formal swap "probably won't be necessary," according to reports. Investing.com summarized Hassett's comments and noted he had not yet discussed the issue with Treasury Secretary Bessent.
How A Swap Line Would Work
Currency-swap lines allow central banks to tap dollars on a temporary basis in order to defend currency pegs or refill reserves on relatively favorable terms. These arrangements are usually handled through the Federal Reserve rather than as one-off Treasury grants, and they are designed as short-term liquidity backstops rather than open-ended bailouts, so any approval would require technical signoff from central bankers. Fortune explains the mechanics and typical size limits of such swap lines.
The Broader Stakes
The Wall Street Journal also reported that Emirati officials warned they might be pushed to use Chinese yuan or other currencies for oil sales if dollar access tightens, a signal that the conflict could speed up moves away from the petrodollar system. That possibility turns any U.S.-backed lifeline into more than just a financial tool, raising strategic questions about how strongly Washington intends to back its Gulf partners.
What Comes Next
For now, no swap has been agreed and U.S. officials say any decision would involve both the Treasury Department and the Federal Reserve, with markets watching closely for the next signal. Reuters reports that officials in Washington and Abu Dhabi have not announced a formal request and will assess whether such a move is needed as conditions evolve.
