70 J. KRANE
By late 2019, the UAE had backed away from confronting Iran,
perhaps due to inconsistencies in the Trump administration approach of
stoking conflict with Iran while seeking to avoid a major US role in any
resulting war. The UAE therefore made concessions aimed at reducing the
likelihood that the UAE would bear the brunt of any Iranian retaliation.
UAE-Iran Gas Trade
The UAE-Iran gas trade has paralleled the political relationship, with signs
of promise undermined by dispute. Under a 25-year export agreement
signed in 2001, Iran was supposed to supply a Sharjah-based firm with
600 million cubic feet of gas per day by 2005, via undersea pipelines
between the UAE and multiple gas fields off Iran’s Sirri Island. But
Iranian parliamentarians protested what they saw as overly generous terms
for UAE-based Crescent Petroleum. Iranian gas would have been sold at
prices near $1/mmbtu, based on a crude-linked formula drawn up when
oil prices were $18/bbl. 36
Other than a brief test of the Sharjah leg of the pipeline in 2010—
which found leaks during transmission—the pipeline has remained
unused. Attempts to renegotiate have failed. An international tribunal in
2014 found in favor of Crescent Petroleum, which has begun pursuing
damages from the National Iranian Oil Co. 37 Discussions revived in 2017
yielded hopes that Iran would finally start its exports. 38 But trade opportunity evaporated when the UAE backed Trump administration sanctions
on Iranian exports.
Relations with Qatar
UAE relations with Qatar, like those with Iran, vary by emirate.
Dubai’s traditionally strong ties—cemented through ruling family intermarriage 39 —contrast with the historically cooler relationship between
Doha and Abu Dhabi. Overall UAE-Qatar ties have deteriorated since
the 1995 coup that brought Sheikh Hamad bin Khalifa al-Thani to power.
Relations continued to decline as Qatar involved itself in regional politics
that included support for opposition groups such as the Muslim Brotherhood during the Arab Spring. The dispute has continued under Sheikh
Tamim bin Hamad al-Thani, who came to power in 2014.
In 2017, the UAE broke off diplomatic relations and launched a
surprise trade embargo on Qatar, joined by Saudi Arabia, Bahrain, and
By late 2019, the UAE had backed away from confronting Iran,
perhaps due to inconsistencies in the Trump administration approach of
stoking conflict with Iran while seeking to avoid a major US role in any
resulting war. The UAE therefore made concessions aimed at reducing the
likelihood that the UAE would bear the brunt of any Iranian retaliation.
UAE-Iran Gas Trade
The UAE-Iran gas trade has paralleled the political relationship, with signs
of promise undermined by dispute. Under a 25-year export agreement
signed in 2001, Iran was supposed to supply a Sharjah-based firm with
600 million cubic feet of gas per day by 2005, via undersea pipelines
between the UAE and multiple gas fields off Iran’s Sirri Island. But
Iranian parliamentarians protested what they saw as overly generous terms
for UAE-based Crescent Petroleum. Iranian gas would have been sold at
prices near $1/mmbtu, based on a crude-linked formula drawn up when
oil prices were $18/bbl. 36
Other than a brief test of the Sharjah leg of the pipeline in 2010—
which found leaks during transmission—the pipeline has remained
unused. Attempts to renegotiate have failed. An international tribunal in
2014 found in favor of Crescent Petroleum, which has begun pursuing
damages from the National Iranian Oil Co. 37 Discussions revived in 2017
yielded hopes that Iran would finally start its exports. 38 But trade opportunity evaporated when the UAE backed Trump administration sanctions
on Iranian exports.
Relations with Qatar
UAE relations with Qatar, like those with Iran, vary by emirate.
Dubai’s traditionally strong ties—cemented through ruling family intermarriage 39 —contrast with the historically cooler relationship between
Doha and Abu Dhabi. Overall UAE-Qatar ties have deteriorated since
the 1995 coup that brought Sheikh Hamad bin Khalifa al-Thani to power.
Relations continued to decline as Qatar involved itself in regional politics
that included support for opposition groups such as the Muslim Brotherhood during the Arab Spring. The dispute has continued under Sheikh
Tamim bin Hamad al-Thani, who came to power in 2014.
In 2017, the UAE broke off diplomatic relations and launched a
surprise trade embargo on Qatar, joined by Saudi Arabia, Bahrain, and