Exclusive: Iran supreme leader’s adviser says talks deadlocked over $24 billion and warns of wider war

By Frederik Pleitgen and Claudia Otto, CNN

Tehran, Iran (CNN) — A potential peace deal between the United States and Iran hinges on the Trump administration agreeing to release $24 billion in frozen Iranian assets, a top Iranian official told CNN on Friday, warning that the US would “enter into a dark corridor” should it resume fighting.

“The negotiations are at a deadlock and (US President Donald) Trump must break this deadlock,” Mohsen Rezaei, military adviser to Supreme Leader Ayatollah Mojtaba Khamenei, told CNN in an exclusive interview in Tehran. “The ball is in Trump’s court.”

Iran has reportedly demanded the release of $12 billion in frozen funds as soon as once an interim agreement is signed with the US, and another $12 billion at a later stage.

US officials are concerned that any unfreezing of funds at this stage could remove a key leverage point over the regime. Trump has demanded that any agreement appear far stronger than the nuclear deal struck in 2015, and to avoid anything that could be construed as handing over “pallets of cash,” a phrase he has invoked to criticize then-President Barack Obama’s decision to give Tehran financial compensation.

In a rare interview with CNN, Rezaei shed light on the thinking inside Iran’s strategic decision-making circles about the country’s postwar vision, the fate of the Strait of Hormuz and how Iran may act if it is attacked again. His remarks carry weight because he remains closely connected to Iran’s security establishment and is widely seen as being close to the current supreme leader, who has not been seen in public since he suffered injuries from an Israeli attack that killed his father on the first day of the war.

Here’s what Rezaei said:

• Releasing frozen Iranian assets: He framed the demand as a trust-building measure, saying the Trump administration’s potential release of the funds would be “a new horizon for the future” of Iran and America: “If he (Trump) wants to reach an agreement with Iran, this $24 billion is a test of trust that Iran wants to have with Trump – this is a test that America must pass and the path will be opened,” he said. “This is our own money, not America’s money.”
• Warning against return to war: Rezaei warned that Iran will “drag the war” beyond the Persian Gulf if the US resumes the conflict, potentially expanding military operations from the Strait of Hormuz to the Indian Ocean, the Bab al-Mandab Strait, the Red Sea and the Mediterranean Sea. “We will give another dimension to the war by attacking these other American bases that we have been attacking so far,” he said, adding that “the possibility of war is low.”

• On a potential meeting between Trump and Khamenei: He did not answer a question about Khamenei’s health and role in the country’s decision-making, but rejected prospects of him meeting Trump. “This will not happen, right now we are in the first stage of negotiations and Mr. Trump has brought the negotiations to a standstill. This will not happen.” This week, Trump said he and Khamenei “seem to be getting along well” and that he would on be “honored” to meet him.

• Reiterates claim of sovereignty over the Strait of Hormuz: Rezaei said Iran and Oman have sovereignty of the key waterway through which one-fifth of the world’s oil and liquefied natural gas passed before the war, and will therefore manage it together. He refrained from framing the demand for ship passage fees at the Strait as a toll, saying Iran would charge a maintenance fee as it shouldn’t have to shoulder the cost of the strait’s management.

Part of the IRGC’s old guard, Rezaei fought in the Iran-Iraq War and went on to lead the force from 1981 to 1997, helping shape it into one of the Islamic Republic’s most powerful institutions. A hardline pragmatist deeply rooted in Iran’s security establishment, he later joined the Expediency Council, which advises the supreme leader, and served as a vice president under former President Ebrahim Raisi. Rezaei also ran for president four times but never won.

During the 40-day US-Israeli war on Iran that began in late February, the Islamic Republic retaliated by targeting 12 countries across the region, striking military facilities, energy infrastructure and civilian sites. Tehran was also reported to have fired missiles toward Diego Garcia, a joint US-UK military base in the Indian Ocean about 2,000 miles from Iran, in an apparent demonstration of its reach.

In his interview with CNN, he cast doubt on the durability of a nuclear agreement with Trump, citing his withdrawal from the 2015 Iran nuclear deal and what he said was his strategy of “ambiguity” in talks.

Should talks fail, Rezaei said Iran is prepared for a potential US invasion of its territory, “then the world will understand Iran’s true capabilities, because our land power is many times greater than our missiles.”

He framed the current war as Iran’s first triumph against its enemies in the Islamic Republic’s 47-year history.

“This is the first time Iran has emerged victorious in wars, while in previous wars Iran has always been defeated,” he said.

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