Updated

The United Arab Emirates said on Monday that Iran fired two ballistic missiles toward maritime traffic in its territory, both of which fell into the sea without causing casualties. The alleged launches came two days after a drone strike on the UAE's only nuclear power plant, and Abu Dhabi responded by cutting off all trade with Iran under an indefinite embargo announced Tuesday. Iran's foreign ministry spokesperson Esmaeil Baghaei rejected the accusations on Tuesday as "baseless," with Tehran suggesting the incident may have been a "false flag operation." The exchange marks a sharp deterioration in relations between Iran and a major Gulf trading partner, and raises the risk that the US-Iran war spreads further across the Gulf. The embargo would sever one of Iran's most important remaining commercial channels for sanctioned goods and finance.