The US is taking steps to redirect Iranian assets to compensate Gulf allies for damage caused by Iranian strikes, a source familiar with the matter told Reuters, as Iran launched further drones after a wave of strikes against Kuwait and Bahrain. Treasury Secretary Scott Bessent has directed a team to assess the costs of Iranian-inflicted destruction on US partners, and officials will consider applying Iranian assets toward future damage as well.
The source did not specify which category of assets the Treasury is examining. Notably, the language used to describe the measures goes beyond frozen funds alone.
The disclosure follows a statement by Mohsen Rezaei, an adviser to Iran’s supreme leader, who told CNN that any peace deal hinges on the release of $24 billion in frozen Iranian assets held by the United States.
Ceasefire under strain as both sides exchange strikes
The announcement adds fresh pressure to an already fragile ceasefire. US forces struck Iranian coastal radar installations at Goruk and Qeshm Island in the Strait of Hormuz on Saturday, after intercepting Iranian drones that US Central Command said posed a threat to maritime traffic. Later that day, the US military shot down two more Iranian attack drones targeting shipping in the strait.
Iran’s Revolutionary Guards subsequently claimed retaliation against US bases in Kuwait and Bahrain. Kuwait’s army reported engaging seven ballistic missiles over residential areas, causing material damage but no casualties. In Bahrain, sirens sounded and residents took shelter. Both governments condemned the strikes. The US military said it intercepted six Iranian ballistic missiles, with a seventh falling short of its target.
Peace negotiations have stalled despite active diplomacy, as a Pakistani minister travelled to Tehran on Saturday carrying a letter for Supreme Leader Ayatollah Mojtaba Khamenei, Iran’s semi-official ISNA agency reported. Tehran continues to demand sanctions relief, access to frozen oil revenues, the lifting of a US port blockade, and leverage over the Strait of Hormuz, a waterway that carried roughly one-fifth of global oil traffic before the conflict began.
President Donald Trump, facing domestic pressure over rising fuel prices, told NBC’s Meet the Press that Iran retains a limited but significant arsenal. “They have some missiles, they have some drones, maybe 21% to 22% of their missiles. It’s a lot of missiles, but it’s not what it was when we first attacked,” Trump said.
