Iran conflict cost US more than $38 billion: Congressional Budget Office

A Pentagon inspector general report Monday said the war has resulted in 'strategic inventory shortfalls'

The US war against Iran has cost the Department of Defence more than $38 billion through Aug 1, and will continue costing up to $3 billion a month or more depending on the intensity of the conflict, according to an assessment released Tuesday by the nonpartisan Congressional Budget Office.

CBO said the war is expected to contribute to inflation into the first quarter of 2027, making inflation roughly 0.5 percentage points higher than they had previously estimated. That's driven largely by the reduction of oil and natural gas shipments through the Strait of Hormuz and disruptions to shipping through the Red Sea.

The estimate, prepared in response to a request for information from the top Democrat on the House Budget committee, Rep Brendan Boyle, largely aligns with a previous estimate from Defence Secretary Pete Hegseth, who pinned the costs at $37.5 billion, according to his Senate testimony.

The estimates come largely from replacing munitions and equipment lost in battle, the CBO said, and do not include costs related to US military personnel killed or injured in the conflict or longer term veterans' healthcare and disability compensation.

Boyle said that beyond with the war's human toll, "this nonpartisan CBO report makes clear that the war has also cost American taxpayers tens of billions of dollars and counting, while continuing to drive up costs." "Donald Trump and Republicans have spent years telling Americans that we cannot afford to help families here at home," Boyle said in a statement, "but apparently they can find tens of billions of dollars, and potentially much more, for a reckless war that is leaving Americans to pay the price." The findings come as voters eye the war and high prices heading toward the midterm elections that will determine control of Congress, where Republicans now hold majority power in the House and Senate.