Tehran condemns reports of US plans for frozen Iranian funds as negotiations over asset release remain unresolved
Tehran: Reports suggesting that the United States is considering using frozen Iranian assets to compensate Persian Gulf allies for alleged damages linked to Iran have sparked a strong political backlash in Tehran, further complicating ongoing discussions over the future of billions of dollars in blocked Iranian funds.
The controversy emerged after a Reuters report cited a source familiar with the matter as saying that Washington is examining options to make frozen Iranian assets available to Gulf partners to help offset future damages allegedly caused by Iran. The report also indicated that the US Treasury Department is assessing whether the same funds could be used to cover past losses incurred by regional allies.
Although the Treasury Department has not officially confirmed the proposal, the report has generated widespread reactions across Iran's political establishment and media landscape.
Frozen Iranian Assets Remain Key Issue in US-Iran Talks
The fate of frozen Iranian assets continues to be one of the most sensitive issues in negotiations between Tehran and Washington. Estimates suggest that tens of billions of dollars belonging to Iran remain blocked in foreign accounts, including holdings in countries such as South Korea and Iraq.
The issue gained further attention after reports indicated progress in discussions concerning the assets, although significant disagreements reportedly remain regarding the timing, legal framework and conditions for any potential release.
Meanwhile, US President Donald Trump stated that sanctions relief and asset unfreezing would not occur before a broader peace agreement is reached, reinforcing Washington's cautious approach toward the matter.
Iran Rejects Proposal Over Frozen Funds
Iranian officials responded sharply to the reports, describing any potential use of Iranian assets without Tehran's approval as unacceptable and contrary to international law.
"Iran's assets are not Washington's war booty or a fund for paying its allies," Iranian Deputy Foreign Minister Kazem Gharibabadi wrote on X.
Gharibabadi described the reported proposal as a "new act of insolence" and warned that any seizure, transfer or allocation of Iranian assets without Iran's consent would constitute an internationally wrongful act. He also argued that countries that allowed their territories or facilities to be used against Iran bear responsibility for damages suffered by Tehran.
Iranian lawmaker Esmail Kowsari, a member of Parliament's National Security and Foreign Policy Committee, also strongly criticized the reported plan.
"The idea is fundamentally ridiculous and unacceptable," Kowsari said, arguing that the United States cannot determine the fate of Iranian national assets.
He further maintained that if compensation discussions were to take place, Washington should instead be held accountable for losses suffered by Iran.
Iranian Media Intensifies Debate on Asset Dispute
The Reuters report received extensive coverage across Iranian media outlets, many of which emphasised Tehran's demand that any release of frozen assets must be transparent, verifiable and free from political conditions.
Media organisations linked to Iran's security establishment suggested that the reported proposal could be connected to rebuilding US military facilities allegedly damaged during Iranian missile and drone operations in the region.
Several outlets argued that Iran had targeted only American military interests and questioned the legitimacy of using Iranian funds for compensation claims involving other countries.
Hardline media platforms also used the controversy to criticize supporters of diplomacy with Washington, claiming that negotiations had failed to secure meaningful progress regarding the release of Iranian assets.
"The creditor was turned into the debtor," one conservative outlet wrote while criticizing the handling of negotiations.
Frozen Russian Assets Comparison Enters Debate
The discussion has also drawn comparisons with the treatment of Russian sovereign assets frozen by Western countries following the outbreak of the Ukraine conflict in 2022.
While Western governments have utilised profits generated by frozen Russian assets to support Ukraine and international financial programs, they have generally avoided permanently confiscating the principal assets themselves.
This distinction has become a major reference point in legal and diplomatic discussions surrounding the treatment of frozen state-owned funds, including Iranian assets held abroad.
Public Reactions Reflect Growing Sensitivity
The issue has also generated significant reactions online, with many Iranian social media users expressing anger over reports that national assets could potentially be redirected toward compensating other countries.
For many observers in Iran, the debate extends beyond economics. Frozen assets have become a symbol of broader tensions between Tehran and Washington, making their future one of the most politically sensitive aspects of ongoing diplomatic engagement.
As negotiations continue, the dispute over frozen Iranian assets is likely to remain a central flashpoint in US-Iran relations, with implications for regional diplomacy, sanctions policy and future economic agreements.
