The United States is considering using Iranian assets to help finance reconstruction and repair efforts in Gulf countries that have suffered damage from recent Iranian military actions, according to reports citing sources familiar with the matter.
The initiative, reportedly being examined by the U.S. Treasury Department under the direction of Treasury Secretary Scott Bessent, would make Iranian assets available to Gulf allies for rebuilding infrastructure and repairing damage caused by Iranian missile and drone attacks. The proposal could include the use of frozen Iranian funds and other assets under U.S. control.
According to sources, the Treasury Department has begun assessing the extent of damage sustained by Gulf states and is seeking comprehensive estimates of reconstruction costs. The plan would not only address existing damage but could also provide a mechanism for covering future repair costs linked to any further Iranian attacks.
The proposal comes amid heightened tensions between Washington and Tehran following a series of security incidents in the Gulf region, including reported Iranian missile and drone strikes targeting Kuwait and Bahrain. The developments have added further strain to already fragile diplomatic efforts aimed at securing a broader understanding between the two countries, according to the news agencies.
The issue is particularly sensitive because access to frozen Iranian assets has been a central demand in ongoing discussions between Tehran and Washington. Iranian officials have repeatedly called for the release of billions of dollars in frozen funds as part of any future agreement, while U.S. officials appear to be exploring alternative uses for those assets.
Analysts say the move could significantly complicate negotiations with Iran, which views the frozen funds as sovereign assets that should be returned. At the same time, Gulf states affected by recent attacks may welcome any mechanism that helps offset reconstruction costs without placing additional financial burdens on national budgets.
No formal announcement has yet been made regarding the legal framework or the specific assets that could be used. However, U.S. officials have indicated that all available financial and legal tools are being reviewed to support regional partners and strengthen Gulf security and stability.
If implemented, the plan would represent one of the most significant efforts by Washington to use Iranian-held assets as compensation for damage caused by regional hostilities, potentially setting a precedent for future conflict-related reparations in the Middle East.
