Saudi Arabia tightens scrutiny of financial transfers to UAE: Sources

Saudi Arabia has tightened regulatory oversight of financial transfers to the United Arab Emirates, according to business executives and companies, in a move that signals growing strains between the two Gulf neighbours.

Saudi banks have since mid-May delayed, blocked or returned transfers in various currencies involving the UAE, often without providing an official explanation, according to the executives and companies.

The measures have not been publicly announced, and Saudi authorities have not formally designated the UAE as subject to specific restrictions, says the Middle East Eye.

Saudi Arabia's central bank has denied imposing direct restrictions on specific countries. UAE officials have also said they have received no formal reports from the private sector of unusual delays in transfers.

The reported measures would place the UAE among a small group of countries that Saudi authorities consider high-risk for financial crime and illicit money flows.

The developments come as Riyadh and Abu Dhabi pursue increasingly divergent policies on several regional and economic issues, despite their longstanding partnership and close political and security ties.

Analysts have described the relationship as an "economic war of attrition".

Diverging oil policies

Tensions have grown over oil policy, particularly after the UAE left the Organisation of the Petroleum Exporting Countries in May 2026 and subsequently significantly increased its oil production.

The move highlighted differences between the two major Gulf oil producers over production policy and the role of Opec.

Their positions have also diverged over the war on Iran. The UAE has taken a hawkish stance and has reportedly conducted dozens of airstrikes, while Saudi Arabia has adopted a more hedged position and pushed for negotiations.

The two countries have also clashed over Yemen, where differences over the conflict culminated in a Saudi air strike in December 2025 on a shipment of UAE military equipment.

Tensions spill into public sphere

The disagreements have increasingly extended beyond policy differences, with heated exchanges on social media adding to tensions between the two countries.

In March, the UAE banned Saudi television network Al-Arabiya's accounts on X, formerly known as Twitter.

The financial transfer restrictions reported by businesses add another potential point of friction between the neighbours, whose economies remain closely connected through trade, investment and financial flows.

Neither government has publicly acknowledged a broader deterioration in bilateral economic ties. The Saudi central bank's denial of country-specific restrictions and the UAE's statement that it had received no formal reports of unusual delays indicate that the reported difficulties have not been formally characterised as a bilateral financial measure.