The United Arab Emirates has warned the US Treasury that it could be “forced to use Chinese yuan” in oil trade, the Wall Street Journal reported. UAE Central Bank Governor Khaled Mohamed Balama delivered what the newspaper described as an “implicit threat” against the dollar’s dominant position during a meeting with US Treasury Secretary Scott Bessent in Washington.

Balama reportedly explained that Abu Dhabi could require a lifeline to prevent a dollar liquidity crunch if the economic fallout from the US war against Iran continues to rise. Tehran has pursued a strategy of asymmetric pressure aimed at raising costs for Washington and its allies. The UAE bore the brunt of Iranian retaliation against US military bases, with over 2,800 drones and missiles reportedly fired at the country.

The Dollar Backstop Question

The US Treasury could offer a currency swap, though these arrangements are usually handled by the Federal Reserve. The WSJ said Fed approval for the UAE is unlikely, citing a precedent in which a $20 billion support package was arranged by the Treasury for Argentina. The administration of US President Donald Trump previously floated the idea of Gulf states partially covering the cost of the Iran war. Harvard Kennedy School Professor Linda Bilmes estimated the US directly spent $2 billion per day in the first 40 days of the conflict.

Arab Frustration Surfaces Publicly

Arab frustration with US policies has surfaced in public commentary. Former UAE presidential adviser Abdulkhaleq Abdulla called for US military bases in the country to be closed, arguing they are a burden rather than a strategic asset, and advocated instead for prioritizing acquisition of advanced US weaponry as an alternative defense strategy.

The CI Mavericks Lens

This development sits directly in the structural thesis our members have been building around for years. The petrodollar arrangement — under which Gulf producers denominate oil sales in dollars and recycle surpluses into US Treasuries — has been the bedrock of dollar hegemony since the 1970s. A credible threat to that arrangement from one of the largest producers is not routine noise. It is the kind of geopolitical signal that historically precedes structural shifts in reserve currency composition.

CI Mavericks holds physical gold and real asset positions precisely as a hedge against the debasement and reserve-currency transition risks that events like this represent. We don’t predict the timing. We hold the position.

Source: Wall Street Journal / RT, April 20, 2026. Published for informational and educational purposes only. This article does not constitute investment advice.