The U.S. treasury is exploring whether the roughly $24 billion in Iranian assets held in U.S. custody could be redirected to repair damage inflicted on Gulf allies by Iranian missile and drone attacks. This proposal comes as Washington and Tehran are at a deadlock over a ceasefire extension and broader nuclear negotiations, with Iran demandding the immediate release of the funds as a condition for moving forward.

Scott Bessent’s Directive to Assess Gulf Damage

According to officials familiar with the matter, Treasury Secretary Scott Bessent has instructed Treasury staff to conduct a comprehensive assessment of the damage sustained by U.S.-aligned Gulf states since the outbreak of the conflict. The review is intended to determine whether Iranian assets currently under American control could be leveraged to support reconstruction and repair efforts,including both future damage and earlier attacks.

$12 Billion Demanded by Tehran, Split in Two Phases

Mohsen Rezaei, a senior military adviser to Supreme Leader Ayatollah Mojtaba Khamenei, told CNN that Tehran is demanding $12 billion immediately upon signing an interim agreement, with an additional $12 billion to be released later . Rezaei framed the demand as a test of Washington’s willingness to move forward, insisting that the money rightfully belongs to Iran and is not “America’s money .”

Oak Ridge Mission Signals Serious Negotiation Phase

Axios reported that Special Envoy Steve Witkoff and Jared Kushner quietly traveled to Oak Ridge,Tennessee, to consult with nuclear specialists who could play a key role in implementing a future agreement with Iran. The administration has assembled a team of roughly 100 nuclear specialists and technical experts to prepare for detailed negotiations, including plans for Iran’s enriched uranium stockpile and future enrichment restrictions.

Unresolved Issues and Military Tensions Persist

While the U.S. Central Command announced the shooting down of six Iranian attack drones over the Strait of Hormuz, the broader diplomatic picture remains uncertain. Key issues such as the timing of sanctions relief,the release of Iranian assets, and the schedule for downblending Iran’s uranium stockpile remain unresolved,keeping the standoff alive.

Who Will Decide the Fate of the Frozen Funds?

The proposal to use frozen Iranian assets for Gulf reconstruction is still under evaluation by Treasury officials, with the ultimate decision resting with President Donald Trump. The administration’s willingness to break the deadlock by releasing or redirecting the funds could either pave the way for a breakthrough or deepen the impasse, according to sources familiar with the discussions.