SEOUL, South Korea — In what seems like a win-win-win, the pending U.S.-Iran prisoner swap deal is being lubricated by the discharge of some $6 billion in Iranian {dollars} that had been frozen in banks right here.

President Biden is dealing with warmth in Washington over what critics say is a “ransom payment” to Iran’s theocratic regime, however for resource-hungry South Korea, the accord might open the door to a contemporary begin in bilateral relations with one of many world’s greatest vitality producers.

The deal — which may very well be executed inside days – outcomes from a fancy internet of multinational, cross-domain diplomacy. International safety, U.S. sanctions on Iran, U.S. relations with South Korea, Iran-South Korea relations and a top-level sanctions waiver on transactions with Iran are all in play.

The deal’s primary contours have been first launched by Iranian and U.S. officers final month. The key inexperienced gentle — a waiver on U.S. sanctions towards banks that may deal with the fund switch — was signed by Secretary of State Antony Blinken final week, and Congress was notified earlier this week.

Already officers in Iran, laboring beneath U.S.-imposed sanctions which have badly crippled the home financial system, are speaking up a revived and expanded relationship with South Korea, considered one of Washington’s closest allies within the area.

“Now we can open a new chapter in bilateral relations and the Islamic Republic of Iran welcomes any initiative that will help promote ties between the two countries,” Iranian Foreign Minister Hossein Amirabdollahian mentioned in a Sept. 5 cellphone name with South Korean counterpart, Park Jin, because the deal was coming collectively, in line with an account within the Tehran Times.

South Korean media experiences on the decision mentioned Mr. Park acknowledged that the funds “belong to the people of Iran,” and mentioned releasing the cash might result in improved bilateral relations within the fields of academia, science, sports and tradition.

Seoul discovered itself caught in the midst of the U.S.-Iranian standoff in 2019 when it froze the Iranian financial institution accounts, set as much as purchase South Korean items corresponding to electronics, metal and autos and partly offset by purchases of Iranian crude oil, after the Trump administration repudiated the 2015 Iran nuclear deal and reimposed U.S. sanctions on Tehran.

The deal, assuming it proceeds, will possible remedy a longstanding diplomatic headache for South Korea. Iran repeatedly appealed for entry to the blocked funds and in January 2021, Tehran seized a South Korean tanker, the Hankuk Chemi, within the Strait of Hormuz, citing what officers mentioned have been “environmental and chemical pollution concerns.”

The tanker and its crew have been launched after closed-door negotiations in April of that 12 months, amid experiences the U.S. permitted South Korea to launch $1 billion of the frozen Iranian financial institution funds.

John Kirby, National Security Council coordinator for strategic communications, informed reporters in August the U.S. had labored “extensively” with South Korea to make sure that the switch of such a big quantity would haven't any influence on South Korea’s foreign money.

Prior to the reimposition of U.S. sanctions, South Korea, a trade-reliant vitality importer that pursues a coverage of import variety, had been a significant buyer of Iranian oil provides. It as soon as ranked as one of many world’s high three consumers of Iranian crude oil and was Tehran’s greatest buyer in Asia of condensate, or ultra-light crude, in line with S&P Global.

But merchants stay skeptical that the prisoner deal and the liberating of the financial institution funds will result in a fast resumption of South Korean vitality purchases from a nation that continues to be so hostile to the U.S.

“Even if the [frozen] funds are released, it won’t guarantee anything and there’s still a long way to go for the resumption in Iranian crude imports to be allowed,” a condensate dealer for a South Korean petrochemical maker, informed the monetary publication.

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