The United States and Qatar officials have agreed to prevent Iran from using a $6 billion humanitarian assistance fund, following militant group Hamas's surprise attack on Israel, a news report said Thursday.
The money had been unfrozen in a US-Iran prisoner swap deal announced in recent weeks, where five US detainees were released by Iran after the funds were transferred to accounts in Qatar.
But The Washington Post reported Thursday that a decision was made to halt access to the funds, while President Joe Biden faces rising pressure on the matter given concerns over Iran's connections to Hamas.
Tehran, which financially and militarily backs Hamas, has come under intense scrutiny since fighters of the Palestinian militant group stormed across Israel's southern border at the weekend.
"We have strict oversight of the funds and we retain the right to freeze them," US Secretary of State Antony Blinken told a press conference in Tel Aviv on Thursday.
US officials said earlier that they had not seen any intelligence to show Iran was involved in planning or preparing the Hamas attacks.
But Deputy Treasury Secretary Wally Adeyemo told Democrats in the House of Representatives that the Iran funds are not "going anywhere anytime soon," according to The Washington Post report, which also noted the comment was first published by Punchbowl.
The Treasury Department did not respond to AFP queries on the matter.
Some US senators have called for a re-freeze of the $6 billion in Iranian oil revenue as the conflict raged on.
The Biden administration maintains that the money is restricted to humanitarian use, and previously said it had yet to be dispensed.