Iran war: US costs to $38bn as weapons stocks face 5-year rebuild

The CBO assessment, released on September 15, said the estimated costs include expenditures on munitions and equipment losses, as well as additional

WASHINGTON: The United States has incurred around $38 billion in direct military costs from its conflict with Iran through August 1, 2026, with the Congressional Budget Office (CBO) warning that the financial burden could rise by another $2 billion to $3 billion a month if hostilities continue.

The CBO assessment, released on September 15, said the estimated costs include expenditures on munitions and equipment losses, as well as additional flying hours, fuel and other operational expenses. The estimate does not include some costs associated with repairing damaged military facilities or interest on additional borrowing.

The report also highlighted the depletion of US munitions inventories during the conflict. CBO estimates that replenishing depleted stocks could take at least five years, even if procurement and production rates are increased. The agency estimated that replacing expended munitions alone would cost about $21.7 billion, including approximately $13.1 billion for missile interceptors and $7.3 billion for land-attack cruise missiles.

The reduction in interceptor inventories has raised questions about the US military’s capacity to respond simultaneously to another major conflict. CBO estimated that between one-half and two-thirds of certain missile-defence interceptor inventories had been consumed since June 2025, although the Pentagon does not publicly disclose the precise size of its stockpiles.

The CBO also projected economic effects from disruptions to energy supplies and shipping routes. It estimated that the conflict could leave inflation about 0.5 percentage points higher in the first quarter of 2027 than it would have been without the war, largely because of higher energy prices.

The Strait of Hormuz has emerged as a major factor in the economic fallout. Disruptions to shipping through the strategically important waterway have contributed to higher energy prices, adding pressure to economies dependent on oil and gas supplies.

The CBO’s $38 billion estimate also excludes certain costs associated with damage to US military facilities in the region. The agency noted that its assessment was affected by limited information from the Department of Defense, which did not provide responses to CBO requests for data.

The financial burden could therefore exceed the headline figure as additional operational expenses, infrastructure repairs and financing costs are taken into account.

The report has also drawn attention to the broader strategic implications of depleted US weapons inventories, particularly as Washington seeks to maintain military readiness for other potential contingencies around the world.

With the conflict continuing to generate substantial military and economic costs, the CBO assessment underscores the long-term financial and logistical consequences of sustaining high-intensity military operations.