Trade between Iran and Dubai has fallen by 31 percent compared to last year, Dubai customs officials report.

Reuters reports that U.S. sanctions on Iran are at the root of this decline in trade between Iran and Dubai.

The report indicates that tens of thousands of Iranians reside in Dubai, which has become a major hub for Iranian exports; however, financial sanctions on Iranian banks have restricted business deals with Iran, leading to a fall in trade.

The head of Dubai customs, Ahmad Bouti Ahmad, reports that in 2012, trade with Iran barely reached 25 billion dirhams (6.8 billion dollars), while in 2011 it was at 36 billion dirhams.

The devaluation of the Iranian national currency has also been a factor in making Dubai banks reluctant to deal with Iran.