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

Washington, DC [US], June 7 : The US Treasury Department is planning to leverage Iranian assets to assist Gulf allies in rebuilding from destruction inflicted by Tehran's regime during the ongoing war, according to a CBS News report.
A source familiar with US Treasury Secretary Scott Bessent's thinking revealed on Saturday 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."
The directive marks a significant shift in how Washington intends to handle frozen foreign capital. Bessent has instructed officials to obtain detailed financial projections from partner nations in the Gulf regarding the total expenditure required to fix infrastructure hit since the hostilities erupted.
Furthermore, the Treasury is poised to examine whether these seized assets can legally and practically be deployed to fund restorations for destruction that has "already been sustained by Gulf allies during the conflict," the source told CBS News.
Currently, it remains uncertain which specific holdings will be targeted to fund the reconstruction initiatives -- whether liquid funds held in frozen bank accounts or physical property such as oil tankers.
The strategy comes at a delicate time for international diplomacy. During concurrent indirect peace negotiations between Washington and Tehran, Iran has maintained that "any deal would require the lifting of sanctions to allow the release of billions of dollars in Iranian frozen assets abroad."
Since the outbreak of hostilities in late February, Tehran has carried out sporadic drone and missile offensives targeting multiple Gulf nations, including Saudi Arabia, the United Arab Emirates, Kuwait, Bahrain, Qatar, and Oman.
According to the source cited by CBS News, the overarching objective remains holding the regime financially accountable for its regional aggression while alleviating the economic burden on key US security partners in the region.
This contentious asset proposal has materialised at a highly volatile juncture, as the United States and Iran actively trade military strikes despite a nominal ceasefire being in place.
The immediate catalyst for the heightened friction was a pre-dawn operation on Saturday, when US forces launched targeted strikes against Iranian coastal radar installations located in Goruk and on Qeshm Island within the critical Strait of Hormuz. US Central Command stated that the military action was initiated after intercepting Iranian drones that posed an immediate threat to commercial shipping lanes in the strategic waterway.
In direct retaliation for the radar strikes, Iran fired a barrage of missiles aimed at US military facilities situated in Kuwait and Bahrain. According to Kuwaiti authorities, seven ballistic missiles traversed populated areas, resulting in structural damage but causing no casualties, while Bahrain activated its public warning sirens and instructed citizens to take immediate shelter.
An official statement from Iran's Revolutionary Guard claimed that its strikes successfully targeted American military installations in both Gulf nations, though the US military countered that six of the incoming missiles were intercepted by air defences, while another failed to reach its intended target.
These rapid military exchanges have severely complicated the broader diplomatic tracks, which are already stalled due to Tehran's sweeping demands. Beyond insisting on the release of USD 24 billion in frozen revenues, an adviser to Iran's supreme leader indicated that securing these funds remains a non-negotiable component of any future peace framework, even as Tehran continues to seek leverage over shipping corridors through the Strait of Hormuz and relief from sanctions affecting its oil exports.
Amid these gridlocked negotiations, Pakistan has attempted to intercede, with Pakistani Interior Minister Mohsin Naqvi travelling to Tehran on Saturday to deliver a special message from Islamabad's leadership to Iran's Supreme Leader, Mojtaba Khamenei.
However, the prospects for a diplomatic breakthrough are further dimmed as the conflict expands across multiple regional fronts, particularly in Lebanon. An Israeli strike recently hit a military vehicle in the southern region of the country, killing three members of the Lebanese armed forces, including two officers, according to an official statement from the Lebanese army.
This Lebanese front has become deeply intertwined with the wider US-Iran friction, as Tehran has explicitly conditioned any diplomatic progress with Washington on a comprehensive ceasefire involving Israel and Hezbollah, while Israel has signalled its intention to sustain active military operations and preserve its strategic troop deployments.
The security situation has drawn further scrutiny following a separate development in which Lebanese Army Commander General Rudolf Haykal travelled to Pakistan following an invitation from the Pakistani military leadership.
Ultimately, the persistent combat operations spanning from the waters of the Gulf to the borders of Lebanon continue to present severe obstacles for international negotiators attempting to transition the highly volatile ceasefire into a permanent and verifiable peace agreement.