What are Iran's frozen assets at heart of US-Iran deal?
What's the story
The Iran-US peace deal reportedly includes unfreezing around $12 billion in Iranian assets initially, and the same amount later. The peace accord, which was announced on Sunday, is scheduled to be signed on Friday in Switzerland. However, although there are conflicting reports about the timing and amount of the release, it is believed that the total value of these assets could exceed $100 billion accrued over the years.
Asset unfreezing
Frozen assets include oil revenues, foreign exchange, banking assets
Iran's total frozen or restricted assets abroad include oil revenues in restricted accounts, foreign exchange reserves, banking assets, and other claims. The 14-point Memorandum of Understanding (MoU) is expected to facilitate the unfreezing of $24 billion over a 60-day negotiation period. Iran has insisted that nuclear talks will only commence after the funds are released, although a US official has dismissed this condition.
Historical context
History of frozen Iranian assets
The freezing of Iranian assets dates back to the 1970s, following the Islamic Revolution and the US embassy hostage crisis in 1979. President Jimmy Carter had blocked Iranian government assets under US jurisdiction after revolutionaries seized the US embassy in Tehran. In dollar-value terms, nearly $12 billion in Iranian government assets were frozen at that time, mostly in US banks.
Economic consequences
Trump-era sanctions and their impact
Most of the current asset freezes stem from sanctions imposed after President Donald Trump withdrew from the 2015 nuclear deal in 2018. These sanctions restricted Iran's access to oil revenues and foreign banking channels, cutting off significant income sources. Trump's "maximum pressure" campaign included secondary sanctions on third countries and banks dealing with Iran, further restricting Iranian-linked funds due to regional proxy support and alleged human rights violations.
Asset management
Foreign banks holding Iranian funds
Countries like South Korea, Japan, and India have continued to buy limited Iranian oil under waivers, but US sanctions blocked direct payments. Banks in these countries held Iranian funds in escrow or restricted accounts to avoid penalties. The first phase of the reported MoU involves around $12 billion, largely held by foreign financial institutions, including Qatar.