Cost of Iran war grows, as Trump throws its end into question

Defense Cost of Iran war grows, as Trump throws its end into question Comments: by Filip Timotija - 07/11/26 4:00 PM ET Comments: Link copied by Filip Timotija - 07/11/26 4:00 PM ET Comments: Link copied

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The cost of America’s military operations against Iran is steadily growing, with continued escalations over the Strait of Hormuz this week as President Trump threatens to blow up negotiations and return to all-out war.

The immediate cost of military actions in the Middle East will run the government tens of billions of dollars, but the broader impact on the economy, repairing regional assets and paying veterans will push the price far higher — a cost the Trump administration argues is worthwhile to keep Iran from pursuing a nuclear bomb.

To help cover the cost of some stockpile replacements and troop deployments in the U.S. Central Command (Centcom) theater, the White House has requested a $87 billion supplemental, a bill that faces bipartisan scrutiny and likely needs Democratic votes to pass.

Asked on Friday how much the war had cost American taxpayers so far, the Pentagon pointed to Defense Secretary Pete Hegseth’s congressional testimony in May.

During an appearance in front of the House Appropriations Committee in early May, the Pentagon’s acting chief financial officer, Jules Hurst III, who testified alongside Hegseth, told lawmakers the cost of the conflict was nearing $29 billion.

“That’s because of updated repair and replacement of equipment costs and also just general operational costs keep people in theater,” Hurst said when questioned by Rep. Pete Aguilar (D-Calif.).

Then Office of Management and Budget Director Russell Vought told Congress a month later that the Iran war had cost about $30 billion, but experts who spoke with The Hill placed the topline figure far higher.

The American Enterprise Institute (AEI), a conservative-leaning think tank, estimated in late June the cost of Operation Epic Fury to be $38.6 billion. The Center for Strategic and International Studies, in its late-June report, put the cost around $40 billion.

Kent Smetters, the Boettner Chair Professor at the University of Pennsylvania’s Wharton School, said the cost of the war over the two-month period between February and April was around $45 billion. He attributed the figure to some deferred costs that appeared to not have been taken into account by the administration.

“They were doing, for example, replenishment of munitions at the cost at which they were purchased, and not as replacement costs, and replacement costs are quite a bit higher,” Smetters, who has worked in the Congressional Budget Office, said in an interview with The Hill.

“If you’re trying to replace fast, it’s a really steep marginal cost curve.”

Linda J. Bilmes, the Daniel Patrick Moynihan Senior Lecturer in Public Policy at the Harvard Kennedy School, said the topline figure the Pentagon has given for the conflict is too low because the department doesn’t “do their accounting properly.”

“This is not my opinion. This is the you know opinion of every auditor that has ever tried to audit the Pentagon budget because they have flunked their audit every year since audits began and even after a lot of work on this, they’re only just being able to sort of submit an audit, but they can’t actually account for stuff properly,” Bilmes said in an interview with The Hill, placing the cost of the war at about $100 billion, calling those “tip of the iceberg costs.”

The precision munitions the U.S. military used during the early days in Iran represent the bulk of the cost, with U.S. forces firing long-range Tomahawks, JASSMs, and PrSMs, ATACMS and others. Centcom Commander Adm. Brad Cooper told the Senate in May the military fired over 13,000 strike munitions by the time the ceasefire was reached. The first six days of the war cost more than $11.3 billion, Pentagon officials told lawmakers during a closed-door briefing.

“The munitions are really expensive relative to [the] Iraq War, but it’s also true we use a lot less of them,” Smetters, who is a faculty research fellow at the National Bureau of Economic Research, said. “They’re also a lot more accurate.”

After the initial days of the conflict, the U.S. military relied on more low-cost munitions, but they would need to be replaced as pre-war stockpiles were not considered adequate.

“The coalition’s success in rapidly suppressing Iranian air defense systems greatly reduced the daily cost of munitions,” CSIS wrote in its June report. “U.S. forces predominantly used cheaper, short-range munitions rather than expensive, long-range systems after the first few days of the war.”

The White House’s $87 billion ask to help backfill munitions and restore Pentagon coffers depleted during the war has been met with skepticism from lawmakers in both parties, some of whom are reluctant to authorize spending for an unpopular war.

The bill contains $1.7 billion for Pentagon readiness; $17.3 billion for operational costs; $1.5 billion for fuel costs; $1.2 billion for administration priorities; $21 billion for munitions; $5.1 billion for cybersecurity and autonomy; $2.4 billion for drones; $800 million for the National Guard; and $12.1 billion for other “classified” programs.

McCusker, who is now a senior fellow at AEI focusing on defense strategy, budget and innovation, said in an interview with The Hill that she is wondering if the update on the supplemental will include a specific callout for repair and replacement of damaged equipment, including aircraft, drones, radars and similar assets.

The ongoing costs of Epic Fury have gone down during the fragile ceasefire due to decreased activity, but it is not at zero since U.S. forces are still operating. The occasional skirmishes saw the military expend some munitions, but considerably less than during the eight-week period of active airstrikes inside Iran.

The fragile ceasefire fell apart this week with Tehran targeting commercial ships in the Strait of Hormuz. The U.S. military unleashed two rounds of strikes inside Iran, in back-to-back days, striking around 170 targets. Even during periods where the ceasefire has held, the U.S. is deploying thousands of troops and two aircraft carrier strike groups around Iran.

“Just based on the number of ships in the region, the number of personnel in the region, the special pay for those personnel — and you know sort of the amount more of you know sort of flying and you know sort of indication and warning type activities that we’re doing in the area just during steady state — and so those costs actually aren’t that high either, but they will continue to add up each day, right?” said Elaine McCusker, who served as deputy and then acting Pentagon’s comptroller during Trump’s first term.

Smetters said during the period of low kinetic engagement of the U.S. military, the daily cost totals about $300 million.

“That would be incremental, maybe a little bit less than that. It just depends on what they’re doing throughout the day, how many sorties and how many plane rides, all the stuff that they’re doing,” he said.

On Friday, Trump said the U.S. ceasefire with Iran, which has been in place since June 17, is over, even as he added that diplomatic talks to potentially strike a peace deal will continue.

“The Islamic Republic of Iran has asked us to continue ‘talks.’ We have agreed to do so, but the United States has stated to them, in no uncertain terms, that the Cease Fire is OVER!” the president wrote on Truth Social.

Regardless of when the conflict ends, the war has also accrued significant mid-term and long-term costs.

Bilmes, who served as the assistant secretary and chief financial officer of the Commerce Department during the Clinton administration, estimated that the repair of U.S. military installations in the seven countries in the region would cost between $250 and $300 billion over the course of the next four to five years.

The figure includes repairs of Navy ships such as the USS Gerald R. Ford, the largest and most-advanced aircraft carrier in the world.

Smetters, of the Wharton School, said the average American household would spend an additional $240 in higher gasoline prices for the four months of the war. But if the conflict continues for a full year, the number could climb somewhere between $750 and $800.

Brown University’s Watson School of International and Public Affairs Iran War energy cost tracker estimates the conflict presents more than a $67 billion burden on consumers. When divided, gasoline is running consumers over $36 billion, while diesel is more than $30 billion.

Additionally, the lifetime benefits for veterans who served during Epic Fury would run the government between $250 and $500 billion over a 10-year period, according to Bilmes.

“But the clinker on this is the fact that all of this money has been borrowed, all the money we’ve spent, all the money that we’re going to be spending to rebuild all this stuff,” she said in an interview “And so we have to pay interest on that debt, and the borrowing costs now are higher considerably than they were in the 2000s when the government could borrow very cheaply.”

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