Pentagon and CBO reports detail $38 billion Iran war cost and critical munitions depletion

Financial toll and inflation projections

The military campaign in Iran has cost the United States $38 billion during its first five months, according to figures released by the Congressional Budget Office. The total exceeds half of the war funding requested by the White House and aligns closely with the $37.5 billion figure presented to Congress by Defense Secretary Pete Hegseth in late July. A separate mandatory report from the Pentagon Inspector General calculated military operational costs at $33.4 billion between 28 February and 30 June, with $22.3 billion spent on munitions alone. The Congressional Budget Office projects future operational costs at $2 billion to $3 billion per month, while warning that disruptions to oil and gas traffic through the Strait of Hormuz will increase US headline inflation by 0.5 percentage points and core inflation by 0.3 percentage points by early 2027.

Munitions depletion and strategic risks

The Pentagon Inspector General reported that operations under Operation Epic Fury produced strategic inventory gaps and exposed supply bottlenecks across the defense manufacturing base. Stockpiles of key weapon systems have fallen sharply, with media reports citing internal sources indicating that nearly 80% of pre-war THAAD interceptors have been expended, alongside heavy consumption of Patriot interceptors and Tomahawk cruise missiles. The Congressional Budget Office estimated that replenishing depleted munitions stockpiles could take five years or longer, curtailing the military capacity of the United States to respond to potential conflicts, including deterrence scenarios involving China and Taiwan. The shortage also complicates ongoing military assistance programs that supply Patriot interceptors to Ukraine.

Regional base damage and logistics disruptions

Iranian missile and drone strikes caused physical damage across hundreds of buildings and structures at US installations in Bahrain, Iraq, Jordan, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates. Aircraft losses confirmed by military authorities include between one and four F-15 fighters, one damaged F-35 fighter, between five and seven KC-135 tankers, one E-3 reconnaissance aircraft, one AH-64 helicopter, and up to 30 MQ-9 Reaper drones valued at roughly $30 million each. Damage to diplomatic facilities across Iraq, Kuwait, Saudi Arabia, and the United Arab Emirates totaled $184 million. Strike damage to the logistics hub in Bahrain forced the US Navy Fifth Fleet to reroute resupply chains to the atoll of Diego Garcia in the Indian Ocean, creating a 14-to-18-day logistics turnaround. Military casualties include 7 to 11 personnel killed in action and seven non-hostile deaths, including six personnel killed in a KC-135 collision over Iraq.

Political responses and congressional votes

Donald Trump dismissed reports of defense shortages on Monday, writing on Truth Social that domestic manufacturers were producing more weapons than at any previous time in American history. He asserted that energy costs would decline rapidly once fighting concludes.

The oil price will fall like a stone as soon as the military conflict with Iran is over, and that will not take much longer.

Representative Brendan Boyle criticized the administration for spending tens of billions of dollars on foreign conflict while citing budget limitations for domestic programs. The reports arrived as the House of Representatives prepared to vote on a resolution to withdraw US armed forces from hostilities without a formal declaration of war, representing the 18th attempt this year to constrain presidential war powers.