South Korea and Iran flag.
South Korea and Iran flag.. Image Source: IANS News

Seoul, Jan 29 : South Korea and Iran plan to hold working-level consultations next month in Seoul to discuss ways to untangle yearslong disputes over Tehran's assets frozen here under US sanctions, a South Korean news agency quoted an informed source saying.

Bilateral relations remain frayed over $7 billion in Iranian funds locked in two Korean banks under US sanctions, which were reimposed after former President Donald Trump in 2018 withdrew from a 2015 nuclear deal, Yonhap news agency reported.

The thorny issue has drawn renewed attention, with talks to revive the 2015 accord standing at a critical phase, as Iranian officials demand sanctions relief for an agreement.

Seoul officials say the proposed working groups are expected to go over details of a potential money transfer once sanctions are lifted and also discuss other aspects in the event of a no deal.

"The working groups are expected to mainly discuss details of the payment method of the Iranian assets if the US grants sanctions relief," the source told Yonhap News on the condition of anonymity.

"They could talk further on the possibility of resuming oil imports from Iran once sanctions are lifted." Iran, which sits on the world's fourth-largest oil reserves, had been a key oil supplier to resource-poor South Korea and in turn imported industrial equipment, household appliances and vehicle parts from Seoul.

South Korea imported $7.8 billion worth of oil from Iran in 2017, but it has stopped Iranian purchases since 2019 due to US sanctions that ban the Islamic republic's oil exports, according to the data by the Korea International Trade Association.

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