Overview of Iran’s Frozen Assets
Frozen assets refer to funds or financial holdings that are blocked legally due to sanctions. In Iran’s scenario, these assets mainly include oil revenues and foreign currency reserves held in various foreign banks.
Iran’s exposure to U.S. sanctions dates back to the 1979 Iranian Revolution. Further measures have been added over the years, stemming from nuclear program concerns, human rights issues, and support for militant groups in the Middle East.
The prolonged sanctions, alongside high inflation and currency depreciation, have severely impacted Iran’s economy. Additional challenges arise from recent conflicts. Unblocking these assets could offer billions in resources to help alleviate Iran’s economic pressures.
Location of Frozen Iranian Assets
The estimates regarding frozen foreign assets vary substantially. Iranian officials claim these assets might total $100 billion, while other estimates suggest under $50 billion.
China holds the largest portion, estimated between $20 billion and $50 billion, as The Wall Street Journal reported. China is a prominent buyer of Iranian oil.
India, prior to the JCPOA nuclear agreement, was the second-largest oil buyer from Iran. Iraq holds approximately $15 billion in assets, buying electricity and natural gas from Iran.
Other countries with varying amounts of frozen Iranian assets include Japan, Luxembourg, the U.S., South Korea, Qatar, and Oman.
Details of the Memorandum of Understanding (MOU)
The 14-point MOU between Iran and the United States includes provisions for releasing frozen Iranian assets. Signed on Friday, June 17, it highlights the procedures for asset release.
Paragraph 11 mentions the commitment by the U.S. to fully release Iran’s funds upon MOU implementation. The U.S. and Iran will jointly agree on release procedures during negotiations. Funds can be used for payments to any beneficiary named by Iran’s Central Bank, with the U.S. issuing necessary licenses and authorizations.
Official Statements on Frozen Funds
U.S. President Donald Trump stated that Iran should use unfrozen funds to buy American food. He emphasized the dire need for food due to Iran’s population of 91 million.
On the contrary, Iranian officials refuted this perspective. Iran’s UN Ambassador Ali Bahreini asserted Iran’s exclusive right to decide the use of its defrozen assets, dismissing claims of external influence.
Separately, Iranian Parliament Speaker Mohammad Bagher Ghalibaf mentioned a $12 billion release in two tranches of $6 billion each, as reported on The National.