US plans to tap seized Iranian funds for Gulf allies' war recovery amid faltering ceasefire: Report

The US Treasury Department is reportedly planning to tap into seized Iranian assets to aid Gulf nations in their recovery from damage inflicted during the ongoing conflict with Iran. A source close to Treasury Secretary Scott Bessent indicated that the department intends to "utilize all available authorities to make Iranian assets accessible for rebuilding and repair efforts related to any future damage inflicted by Iran."

This directive signifies a potential shift in how Washington manages frozen foreign capital. Secretary Bessent has tasked officials with gathering detailed financial projections from Gulf partners on the costs of repairing infrastructure damaged since hostilities began. The Treasury is also exploring the legal and practical feasibility of using these seized assets to fund repairs for damage already sustained.

The specific assets to be targeted remain unclear, with possibilities ranging from liquid funds in frozen bank accounts to physical assets like oil tankers. This strategy emerges at a sensitive diplomatic moment, as Iran has linked any potential deal in ongoing indirect peace negotiations with Washington to the lifting of sanctions and the release of billions in frozen assets.

The US objective is to hold Iran financially accountable for its regional aggression while simultaneously easing the economic strain on key American security partners. This contentious proposal comes as the US and Iran continue to engage in military strikes, despite a nominal ceasefire. Recent escalations include US strikes on Iranian radar installations and retaliatory Iranian missile attacks on US facilities in Kuwait and Bahrain.

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intends to utilize all available authorities to make Iranian assets accessible for rebuilding and repair efforts related to any future damage inflicted by Iran.