Possible Iran Deal Could Unlock Billions Through Sanctions Relief and Frozen Assets

A pending U.S.-Iran agreement could deliver a major economic windfall to Iran, even though no final deal has been signed and different leaks have described the terms inconsistently. The article says three provisions under discussion could revive the Iranian economy: lifting European and American sanctions on oil sales, unfreezing Iranian funds held in banks around the world, and creating a large U.S. compensation fund for war damage.

The most immediate boost would come from restoring oil exports, especially to Europe. Before sanctions tightened, Iran traded tens of billions of euros a year with the European Union. After the 2015 nuclear deal, JCPOA, trade between Iran and Europe jumped to about 20 billion euros annually in the first two years, but collapsed to 3.7 billion euros last year after Donald Trump withdrew from the accord and sanctions returned. On Monday, the foreign ministers of Germany, Britain, France and Italy said, "Iran must never have nuclear weapons," and added that if Iran takes "proven and verifiable steps," they are ready to lift relevant sanctions.

The second possible benefit is the release of frozen Iranian money. Axios reported that Washington denied this was part of the deal, but Tehran says the emerging agreement would free $24 billion during the 60-day negotiating period. Iran says about $100 billion in assets are frozen worldwide, including funds in Gulf states, Turkey, Qatar and elsewhere. Reuters recently reported that the United Arab Emirates had agreed to release billions to Iran to curb attacks against it, though Abu Dhabi denied the claim.

A separate Iranian demand published Sunday by the state-linked Mehr agency says Tehran wants the U.S. and its allies to present reconstruction plans worth at least $300 billion. European governments are also watching for any deal because the war and rising energy prices have worsened inflation and strained their budgets.