Washington is considering whether Iranian assets could be used to pay for repairs in Gulf states hit by Tehran’s attacks, a proposal that could add fresh strain to already fragile efforts to end the three-month conflict.
U.S. Treasury Secretary Scott Bessent has instructed officials to calculate the cost of damage suffered by American allies in the region, according to a source familiar with the discussions. The administration is also examining whether Iranian holdings could be redirected towards future reconstruction if further strikes take place.
The review comes as Iran continues to press for access to $24 billion in assets frozen by the United States. Mohsen Rezaei, an adviser to Iran’s supreme leader, told CNN that releasing the funds would be central to any agreement aimed at bringing the war to an end.
The source did not identify which assets were under consideration, and it remains unclear what legal route Washington could use to transfer them. However, the proposal signals that the Trump administration is prepared to increase financial pressure on Tehran while negotiations remain stalled.
Tensions intensified again after U.S. forces struck Iranian radar sites near the Strait of Hormuz, following drone launches that Washington said threatened commercial vessels. Iran’s Revolutionary Guard later said it had retaliated against American bases in Kuwait and Bahrain.
Kuwait’s military reported intercepting seven ballistic missiles travelling over residential areas. The strikes caused material damage, but no casualties were recorded. Bahrain also sounded air-raid sirens and urged residents to seek shelter.
The renewed exchange has placed further pressure on diplomatic efforts led by Pakistan, which has been acting as an intermediary. Pakistani Interior Minister Mohsin Naqvi travelled to Tehran for talks with senior Iranian officials and carried a “special letter” from his country’s prime minister and army chief.
The conflict has disrupted shipping through the Strait of Hormuz, a route that carried about a fifth of global oil traffic before the war began. Rising fuel prices and supply chain delays have increased pressure on U.S. President Donald Trump to secure a breakthrough.
Fighting has also continued in Lebanon, where Iran has sought to link any agreement with Washington to an end to the conflict between Israel and Hezbollah. U.S. and Lebanese officials have resisted combining the two negotiating tracks, raising further questions over whether a wider settlement remains within reach.