What is the Trump administration's proposed use for Iran's frozen assets, and which countries are expected to benefit?

The Trump administration is proposing to redirect some of Iran's frozen financial assets—reportedly around $24 billion—to help US allies in the Persian Gulf, including Saudi Arabia, the United Arab Emirates, Kuwait, and Bahrain, repair infrastructure damaged by Iranian missile and drone attacks since the start of the conflict. Treasury Secretary Scott Bessent has directed his team to assess regional damage and compile cost estimates for repairs, including potential reimbursement for past damage to oil infrastructure caused by Tehran and Iran-backed groups.

How does this proposal affect ongoing US–Iran negotiations on a truce extension and broader issues like the nuclear program?

The proposal risks further chilling negotiations on extending a truce in the Iran war, as talks have already bogged down over Tehran’s demand for the release of approximately $24 billion in frozen Iranian assets; the US plan to divert those assets toward Gulf allies’ reconstruction efforts directly contradicts that demand and may undermine trust, potentially delaying progress on reopening the Strait of Hormuz and advancing more detailed discussions about Iran’s nuclear program.