Afghan Taliban leader Mullah Omar confirmed on Thursday that peace talks with the United States are on the horizon.

Omar has demanded the release of Afghan prisoners from the Guantanamo Bay detention facility and complete withdrawal of U.S.-led forces from Afghanistan, The News reports.

The U.S. State Department, however, said they have not yet made any decision on releasing the Taliban prisoners from Guantanamo Bay prison.

Nonetheless, reports have begun circulating that the Obama administration has agreed to release top Taliban leaders in exchange for peace talks despite the long-held U.S. policy against negotiating with terrorists.

According to sources familiar with the talks in the U.S. and in Afghanistan, the Taliban figures slated for release would include Mullah Khair Khowa, a former interior minister, and Noorullah Noori, a former governor in northern Afghanistan.

A more controversial demand by the Taliban is the release of the former army commander Mullah Fazl Akhund.

Washington is said to be mulling the possibility of formally handing him over to the custody of another country, possibly Qatar.

The releases would be payment for Tuesday’s announcement from the Taliban that they are prepared to open a political office in Qatar to conduct peace negotiations “with the international community.”

The Taliban currently holds one American soldier, Bowe Bergdahl, a 25-year-old sergeant captured in June 2009. It is not clear whether he would be freed as part of the deal.

The move comes as the United States and its coalition partners look for a complete draw-down of combat forces in Afghanistan by the end of 2014 despite concerns the Taliban would remain an effective fighting force beyond that point.

Afghan president Hamid Karzai said he endorsed talks between the U.S. and the Taliban insofar as his government was included.