The United States would be willing to discuss with Iran the issue of unlocking its frozen funds in South Korea to achieve the overarching objective of a denuclearized Iran, a State Department spokesman said Tuesday.

Ned Price said the US is insistent in achieving its goal, but not on how or where it will discuss the issue with Iran.

"I would put that in the context of things we would want to discuss, in the context of prospective talks with the Iranians," the spokesman said when asked about the possibility of discussions on the release of Iranian funds held in South Korea.

About $7 billion worth of Iranian assets remain locked in South Korean banks under US sanctions that were put back in place following Washington's 2018 withdrawal from the multilateral nuclear pact with Tehran, known as the Joint Comprehensive Plan of Action (JCPOA).

South Korea has offered to release part of the Iranian funds to a bank account in Switzerland to be used for humanitarian purposes following Iran's seizure of a South Korean tanker and its crew members in January.

Seoul, however, said the money will not be released unless Washington agrees.

Price earlier said the allies were in consultation over the issue.

"Again, we are not dogmatic about the format. We are dogmatic about other elements, including our overriding objective in this," he told a press briefing on Tuesday, after reiterating the US' willingness to return to the JCPOA following Iran's compliance with its obligations under the nuclear deal, signed July 2015. (Yonhap)