• Iran's top diplomat says Washington will grant access to frozen assets, but U.S. officials insist no money will be handed over.
  • Negotiations hinge on staged, conditional releases for humanitarian purposes versus Tehran's demand for comprehensive sanctions relief.
  • The impasse underscores deep mistrust as both sides explore an interim deal to de-escalate tensions.

Stalemate Over Frozen Assets

Iran’s chief negotiator, Ali Baghaei, declared on Thursday that the United States has committed to giving Tehran access to its frozen funds held abroad, according to state media. “The U.S. will commit itself to give Iran access to its frozen funds,” Baghaei said, without providing details on the timing or amount. The statement came amid ongoing indirect talks in Oman aimed at reviving a broader understanding on sanctions relief and regional stability.

However, U.S. officials swiftly pushed back. A State Department spokesperson, speaking on condition of anonymity, said Washington is not planning to transfer any money to Iran. “There is no arrangement to give Iran cash,” the official said, adding that any potential relief would be “limited, conditioned on verifiable steps, and strictly for humanitarian purposes.” The contradictory signals highlight the fragility of the negotiations.

The Core Dispute

The crux of the disagreement is how much of Iran’s estimated $100 billion in frozen overseas assets—mostly oil revenues held in countries like South Korea and Japan—should be released now. Iran demands substantial, upfront access to ease its liquidity crunch, while the U.S. prefers a phased release tied to compliance, possibly through a restricted channel for food and medicine purchases under the Swiss Humanitarian Trade Arrangement. According to people familiar with the matter, the two sides are discussing an interim deal that would unlock around $10 billion in frozen funds initially, with further tranches conditional on Iranian steps to halt uranium enrichment and curb ballistic missile development.

Economic and Political Stakes

For Iran, access to its frozen funds is critical to stabilizing its currency and importing essential goods. The rial has plunged to record lows, and inflation is running at over 40%. A senior Iranian economic official, who asked not to be named, said: “Without real sanctions relief, our ability to manage the economy is severely constrained.” In Washington, critics argue that any release, even for humanitarian purposes, would provide fiscal breathing room for Tehran to fund proxies and accelerate its nuclear program. “This is not about helping the Iranian people,” said a Senate aide close to the administration. “It’s about providing a lifeline to a regime that has its priorities elsewhere.”

Historical Precedents

Past discussions have seen limited funds released under similar humanitarian exceptions—most notably during the 2015-2018 Joint Comprehensive Plan of Action era—but a broad return of assets has never materialized. Analysts note that the current talks resemble the 2023 Qatar-mediated negotiations, which secured a $6 billion prisoner swap but were later scuttled by the October 7 attacks. “The difference now is the urgency,” said a former European diplomat familiar with the discussions. “Both sides seem to want an off-ramp, but the gap in trust is enormous.”

What’s Next

Negotiations are expected to continue through the coming weeks, with a possible announcement within 60 days. The U.S. has stressed that any deal must include enforceable timelines and verification measures. Iran, for its part, insists on a “full and verifiable” removal of sanctions. Meanwhile, financial markets are pricing in uncertainty: oil prices dipped 1.2% on the back of progress rumors, while the Iranian rial strengthened marginally. For now, the ball remains in the court of diplomats, but Baghaei’s confident claim and Washington’s flat denial suggest a tough road ahead.