I received an offer this year from Oxford for Asian and Middle Eastern Studies. During one of my interviews, an interviewer started speaking to me in the language I was applying for. I'm not quite at a conversational level yet and I did make a lot of mistakes when speaking to her, but I received the impression that it's definitely encouraged that applicants have previously had some engagement with the language that they're studying even if they're not fluent/proficient. I would think that being conversational in Arabic definitely helps to demonstrate your interest in the subject you're applying for, although it's not a requirement.