It is easy to understand why the Emiratis were having second thoughts about signing up to a single Gulf currency. The sheer weight of the Saudi economy might give them pause for thought. In European terms, it would be as if Britain were joining a eurozone dominated by a single nation made up of the economies of France, Germany and Italy.

Saudi Arabia dwarfs the other Gulf Cooperation Council (GCC) nations on every measure. Last year, the Kingdom earned a net $285 billion from selling crude. It accounts for about two thirds of the GCC population and has substantial military might. This is not a club of equals. Even more important is their economic focus. Saudi Arabia seeks to transform its economy from one that merely sells barrels of oil into a more sophisticated manufacturer that sells plastics and petrochemicals and other processed commodities worldwide.

The littoral Gulf statelets are also bent on diversification, but the UAE sees its role more as that of an intermediary than a manufacturer. While Abu Dhabi is still a big oil exporter, Dubai’s economy is built on passing trade, real estate and hot money.

The Emirates have been hit hard by the financial crisis as well as by the slump in the oil price. Between January and March, the price of property in Dubai fell by 41 per cent and the city-state owes about $80 billion, heavily dependent on financial guarantees from Abu Dhabi, its richer and less flighty sister down the road. A $10 billion bond issue this year has been used to refinance speculative real estate companies linked to the ruling family, including Nakheel, best known for its Palm development on reclaimed land offshore.

The financial turmoil in Dubai worsened this week when the Emir, Sheikh Mohammed bin Rashid al-Maktoum, replaced his finance minister after a dispute between rival advisers. These are not good times to forge monetary union.

The question is whether it is needed, or even worthwhile. Marios Maratheftis, of Standard Chartered, reckons that monetary union was largely a political objective of the GCC. “The main goal was integration, to create a large economy, a global power,” he says.

However, even after a decade of rapid economic expansion, the trade links between the Gulf states are not huge. They remain largely commodity exporters to countries outside their region and importers of food and manufactured goods from East Asia and Europe. The import bill and currencies pegged to the US dollar left states, such as the UAE, heavily exposed to consumer price inflation. The UAE was a strong supporter of Gulf integration but it may now be tempted in another direction.

As Mr Maratheftis says: “The peg to the dollar should not stay. The UAE will now be free to choose to float [the currency]. One of the arguments for not doing it was the commitment to a common currency.”

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