A new Congressional Budget Office report estimates the U.S. has spent $38 billion on the war with Iran, with ongoing monthly costs projected between $2 billion and $3 billion.
Key facts
- •The $38 billion cost estimate excludes expenses for repairing damaged regional bases, veterans' healthcare, and disability compensation.
- •Defense Secretary Pete Hegseth previously estimated the war's cost at $37.5 billion in July.
- •The CBO report was prepared at the request of Representative Brendan Boyle, the top Democrat on the House Budget Committee.
- •The Pentagon inspector general recently reported that munitions usage has led to strategic inventory shortfalls.
- •The White House requested $87.6 billion in supplemental funding in June, with $42.3 billion directly tied to the conflict.
The U.S. military has spent approximately $38 billion on the conflict with Iran as of August 1, according to a report released Tuesday by the nonpartisan Congressional Budget Office. The war, which began in late February 2026, is expected to incur additional costs of $2 billion to $3 billion per month depending on the intensity of hostilities.
By the numbers
Munitions and Inventory Shortfalls
Replacing expended munitions and lost equipment represents the largest share of the conflict's costs, totaling $21.7 billion through August 1. The CBO warned that the high usage of missile defense interceptors—including Patriot, THAAD, and Navy Standard Missiles—has likely depleted one-half to two-thirds of the U.S. inventory since June 2025. This depletion leaves the military with reduced interceptor stocks for several years, a concern echoed by the Pentagon’s Office for Acquisition and Sustainment regarding industrial base bottlenecks.
Economic and Inflationary Impact
The conflict has contributed to inflationary pressure, primarily due to disruptions in oil and natural gas shipments through the Strait of Hormuz and the Red Sea. The CBO projects that inflation in the first quarter of 2027 will be 0.5 percentage points higher than previously forecast. While the White House and military leadership have downplayed concerns regarding weapons stockpiles, the CBO report notes that the Department of Defense declined to provide information for the analysis.
Timeline
- June 2025The period from which the U.S. began significantly drawing down its inventory of missile defense interceptors.
- February 28, 2026The conflict between the U.S. and Iran began following U.S.-Israeli strikes.
- August 1, 2026The cutoff date for the CBO's $38 billion cost assessment.
- September 15, 2026The Congressional Budget Office released its report on the war's financial impact.
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This article was independently rewritten by ManyPress editorial AI from reporting originally published by Channel NewsAsia, CBS News World, The Hindu.
