CBO reports US war with Iran cost $38 billion through August with monthly expenses up to $3 billion

Spending breakdown and monthly projections

The nonpartisan Congressional Budget Office released an assessment on Tuesday calculating that the U.S. military conflict against Iran has cost $38 billion through August 1, 2026. Monthly expenditures are projected to run between $2 billion and $3 billion depending on operational intensity, with active escalation pushing spending toward the upper figure. The figures track close to the $37.5 billion reported by Defense Secretary Pete Hegseth during a Senate hearing on July 21, 2026. Pete Hegseth requested an additional $67 billion in supplemental funding from Congress during the summer to sustain operations. The armed conflict began on February 28, 2026, following joint U.S. and Israeli strikes against Iranian installations.

Munitions depletion and replacement timeline

Munitions consumption forms the largest component of direct war spending, requiring $21.7 billion alone to replace expended weapons. Restoring depleted stockpiles of missile defense interceptors will require approximately $13 billion, while replacing land-attack cruise missiles accounts for about $7 billion. The CBO estimated that completely replenishing depleted U.S. arsenals could take five years. An inquiry by the Pentagon inspector general released on Monday cited shortages of raw materials and specialized labor as key obstacles delaying production. The U.S. military expended virtually all of its long-range precision missile inventories during the first five months of operations.

Total munitions replacement21.7

Missile defense interceptors13

Land-attack cruise missiles7

Total munitions replacement

21.7 $B

Missile defense interceptors

13 $B

Land-attack cruise missiles

7 $B

Data from the article text

Strategic readiness and economic impact

The rapid expenditure of munitions creates challenges for the U.S. defense posture if another armed conflict breaks out. The CBO report warned that the deficit in interceptors and cruise missiles creates severe operational vulnerabilities against an adversary equipped with large ballistic and cruise missile arsenals. On the domestic front, the CBO projected that the war will add 0.5% to U.S. inflation during the first three months of 2027. The financial assessment does not incorporate federal borrowing expenses, which could add tens of billions of dollars to the total debt burden, nor does it cover recent attacks on U.S. military bases and commercial vessels in the Strait of Hormuz.

Political friction in Washington

The inquiry was conducted at the request of Representative Brendan Boyle of Pennsylvania, the ranking Democrat on the House Budget Committee. The CBO noted that the Department of Defense declined to cooperate with congressional financial auditors during the preparation of the study. Representatives from both the White House and the Pentagon did not provide immediate comments regarding the findings. Representative Brendan Boyle criticized the military campaign and its financial toll ahead of the upcoming November midterm elections.

“Donald Trump's disastrous war in Iran has already taken the lives of brave American servicemembers and left others wounded. Beyond that 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.”

Eighteen U.S. service members have died since hostilities commenced in February 2026, as the Trump administration continues efforts to negotiate an end to the fighting and reopen the Strait of Hormuz.