Reports suggest the US may utilise frozen Iranian assets to compensate Gulf states for missile damage, threatening a fragile Middle East ceasefire.
Middle East Conflict: Amid escalating tensions and widespread destruction in the Middle East, the United States is reportedly considering a major policy move. According to recent reports, Washington may utilise seized Iranian assets to fund reconstruction efforts and compensate Gulf nations for damages incurred during Iranian attacks.
Reuters reports that the US administration is currently assessing the total financial toll of Iran’s strikes on Gulf countries to determine if frozen funds can legally and practically be used for restitution. If executed, this plan is highly likely to further sour relations between Washington and Tehran. While a ceasefire is currently in place, and the US continues to push for a broader peace agreement, Iran remains steadfast in demanding its own conditions be met.
Sources indicate that the US assessment is not limited strictly to frozen funds but could encompass other seized Iranian properties as well.
This development emerges just as Mohsen Rezaei, an advisor to Iran’s Supreme Leader, stated in an interview with CNN that progress on any US-Iran peace accord hinges entirely on Washington releasing $24 billion in frozen Iranian assets.
In contrast, a Bloomberg report reveals that the US Treasury Department has already begun evaluating the damages caused by Iranian strikes. The administration is examining whether these assets can legally be redirected to cover prior losses as well as future reconstruction costs.
The US plan to transfer Iranian wealth to Gulf allies risks triggering a major diplomatic and military backlash. Tensions spiked recently after the US military targeted specific Iranian military sites, prompting Tehran to claim it had struck US bases in Kuwait and Bahrain. Washington, however, maintained that the majority of those incoming missiles were intercepted mid-flight.
While Kuwait and Bahrain have strongly condemned the attacks, Iran continues to demand the easing of oil export sanctions and the immediate release of its multi-billion-dollar frozen funds. With both nations locked in a stalemate over these critical issues, the pressure on current peace talks and the fragile ceasefire is reaching a breaking point.