The US Congressional Budget Office (CBO) said Tuesday that the war launched by the United States and Israel against Iran in late February had cost Washington approximately $38 billion through August 1.
“Through August 1, 2026, the cost of the armed conflict with Iran to the Department of Defense was approximately $38 billion,” the CBO said in a report.
US Defense Secretary Pete Hegseth estimated in July that the war had cost $37.5 billion.
The CBO said the monthly cost of the conflict could range between $2 billion and $3 billion, depending on the intensity of military operations.
If the conflict continues, the cost could be “higher if the violence escalates,” it warned.
The report said the figures include the cost of replenishing ammunition and equipment lost in combat, higher military fuel costs and other expenses.
The CBO prepared its analysis at the request of Democratic lawmakers.
It estimated that the conflict’s main economic impact would come through inflationary pressures caused by disruptions to oil and natural gas prices following Iran’s closure of the Strait of Hormuz.
The CBO estimated that consumer-price inflation in the first quarter of next year would be 0.5 percentage points higher than its February forecast.
It also projected that core inflation, which excludes food and energy prices, would be 0.3 percentage points higher than previously estimated.
The CBO said higher inflation would also push up interest rates on US Treasury securities.
The exchange of attacks comes amid stalled diplomatic efforts to end the war and Washington’s declaration of an “economic war” on Iran, including tighter sanctions on Tehran and countries doing business with it, with the stated aim of economically isolating Iran.
The United States had announced an expansion of secondary sanctions targeting entities and countries around the world that maintain commercial ties with Iran as part of its “economic outcast” campaign against Tehran, while Washington significantly intensified economic pressure on Iran.
Between July 8 and 24, the United States resumed attacks on Iran, while Tehran responded with attacks on countries in the region, before talks resumed over safe passage for vessels through the Strait of Hormuz.
The United States also reinstated a naval blockade of Iranian ports in the Strait of Hormuz after renewed clashes described as the most intense since the ceasefire between the two sides took effect in April.
The war began on February 28, when Israel and the United States attacked Iran. Tehran responded by closing the Strait of Hormuz, which before the war had been the main waterway for nearly one-fifth of global energy supplies.
Source: (AFP) / Reuters
