Breaking down the military’s nearly $40 billion Iran war

The most recent government cost estimate for the war in Iran is roughly $38 billion, which is from the Congressional Budget Office, though the actual cost is already higher.The CBO released its latest cost analysis on Tuesday in response to a request from Rep. Brandon Boyle (D-PA), the ranking member of the House Budget Committee, though the cutoff date for its estimate is Aug. 1, so the cost has continued to rise since then. The $38 billion estimate includes the costs of replacing expended munitions, equipment lost in battle, increased flying hours, and increased fuel costs, among others.This estimate is similar to that from Secretary of War Pete Hegseth, who told the Senate Appropriations Committee on July 21 that the department’s new estimated cost of the war in Iran was $37.5 billion. Munitions The U.S. military carried out more than 13,000 strikes in Iran between the start of the war and the April ceasefire. That total has increased since then. And, it does not include the critical munitions needed for air defense against Iranian retaliation.While senior U.S. military leaders have disputed characterizations that there is a shortfall of these critical munitions, it is known that it will take years to replace the munitions expended very quickly in this war.The U.S. military also used significant numbers of air defense interceptors during the Israel-Iran 12-day war last year.“Although DoD does not reveal the number of munitions it has on hand, a comparison of the reported expenditures of missile defense interceptors with the total numbers that DoD has purchased to date indicates that the United States has probably used between one-half and two-thirds of its inventory of those munitions since June 2025,” the CBO report said.Given the rate of production of these interceptors, which individually cost multiple millions of dollars, the CBO estimated that it could take “at least five years” to rebuild the interceptors’ inventory “even if production was increased.”The administration publicly released its supplemental funding request for $87 billion, of which $67 billion would be for the Pentagon. A little less than a third of that, $21 billion, is for munitions. A U.S. Army air defense artilleryman inspects a Terminal High Altitude Area Defense (THAAD) launcher in the U.S. Central Command area of responsibility. THAAD is an anti-ballistic missile system designed to intercept missiles in their terminal phase. (U.S. Army photo) A Department of Defense Inspector General’s report released on Monday noted that the “munitions expenditure in [Operation Epic Fury] has resulted in strategic inventory shortfalls and revealed industrial base bottlenecks for munitions resupply.”The CBO report noted that the “shortfall” of munitions “would become especially problematic if a conflict arose with an opponent whose arsenal included large numbers of ballistic and cruise missiles,” and it noted that China “maintains such an arsenal, which would probably play a major role in a military conflict involving Taiwan.”One of the more significant losses for the military, aside from the munitions which are designed for single-use, was a Terminal High Altitude Area Defense radar system. The THAAD is one of the primary air defense systems the U.S. uses and the CBO estimated that the cost of one THAAD radar is $500 million.Equipment losses The U.S. military has had about 50 aircraft damaged or destroyed during the war. As many as 30 of them were MQ-9 Reaper drones, which are an unmanned intelligence, surveillance, and reconnaissance drones and can be deployed in ways that are too dangerous for U.S. troops, according to the Inspector General report that was released on Monday.Some aircraft were shot down, and others were destroyed while they were onsite and not being flown. Iran was able to destroy an E-3 airborne early warning and control aircraft and damage five KC-135 refueling aircraft while they were on the ground. Iran’s ability to destroy U.S. aircraft raises questions about base protection from aerial attacks and how to ensure, as they rebuild damaged U.S. bases in the region, they are safeguarded.“I’m much more worried about the assets when they’re on the ground,” Lt. Gen. (Ret) David Nahom told the Washington Examiner. “The F-22 does very well in combat and I would not want to be an opposing country to a four-ship of F-22s in the air when they’re full of missiles and ready to go.“But when those F-22s are sitting on the deck, waiting for gas and waiting for new weapons, there’s a certain vulnerability there and you’re seeing that play out in the Middle East,” Nahom, who is now with the strategic advisor firm Elara Nova, added. “You’re seeing that play out with many of our assets in bases in Saudi Arabia and the Gulf states and certainly in Jordan, which was recently in the news about some damages to some aircraft that were on the ground there.”Alternatively, Iranian forces were able to shoot down an F-15E, an F-35A, and an AH-64 helicopter, though no air force personnel were killed in these incidents. Kuwaiti forces also accidentally shot down three F-15Es during the early days of the war.The CBO estimated that the cost of the equipment lost in the war amounts to roughly $1.9 billion, though it could increase to about $3.3 billion depending on whether the department chooses to replace every lost aircraft, some of which are no longer in production.Personnel On top of the monetary costs, 18 service members have lost their lives during the war. More than 800 troops have sustained injuries, according to the Defense Casualty Analysis System, which is a department-run casualty tracker for all conflicts.Seven of them were killed in non-Iranian attacks — six airmen were killed in a KC-135 refueling accident over Iraq and a navy pilot crashed into the Arabian Sea. Of the other 11 fatalities, six occurred in an Iranian drone attack in Kuwait and one more person was killed in a separate attack in Saudi Arabia — both of which occurred in the opening days of the war.Three others were killed in a July 17 attack on Muwaffaq al-Salti Air Base in Jordan, while the last remaining fatality occurred in Iraq two days later during a controlled detonation of an unexploded ordnance from a downed Iranian attack drone.Currently, 50,000 service members are in the Middle East carrying out these operations, several of whom have been there for extended deployments. The USS Abraham Lincoln had been in the region for the entire war until it recently departed amid concerning reports about the well-being of troops aboard. It has yet to return to its home port but is on its way.Bases/Infrastructure Iran has targeted several U.S. military and diplomatic bases across the Middle East during the war, though the total cost remains unknown in part because it’s unclear how the department intends to rebuild the facilities.The Pentagon has been tight-lipped about the extent of the damage to various bases across the region. The department did not provide the CBO “with information about the value of damaged or destroyed equipment and property,” and as a result, it is not included in its estimate of the cost of the war.Last week, acting U.S. Navy Secretary Hung Cao acknowledged that Iranian forces “blew the hell out of Bahrain,” which was a reference to Naval Support Activity Bahrain, home of the U.S. Fifth Fleet. He was the first senior Pentagon official to publicly discuss the damages with any relative specificity.Given the Air Force’s losses in the region, Chief of Staff of the Air Force Gen. Ken Wilsbach announced on Monday that the department has established a new career path for “point defense,” which essentially means defending specific stationary targets, such as bases.“If every base is going to be threatened, we have to have somebody that knows how to defend it,” he told the Washington Examiner during a media roundtable on Monday during the Air Force Association’s Air and Space Conference. “So obviously that’s a long-term objective. But what I’ll tell you for right now is we’re going to develop the career field and push it forward to the most critical bases that need protecting most.”The Pentagon’s comptroller, Jay Hurst, has previously said the department is unsure “what our future posture is going to be” in the region, and he noted that host countries could contribute to the cost to rebuild the facilities.Diplomatic infrastructure in Iraq, Kuwait, Saudi Arabia, and the United Arab Emirates suffered an estimated $184 million in damages as of the end of June, according to the Pentagon inspector general report.Continuing costs The war, while at a low level of intensity, is still ongoing and the cost continues to grow.If the war continues at the relative quiet that took place in May and June, it would cost roughly $2 billion a month. If it’s a slightly higher tempo like in July, where there was about a two-week period of daily U.S. bombings and Iranian retaliation, it would cost approximately $3 billion, according to the CBO report.Should the war return to the intensity that predated the April 7 ceasefire, it would be much more expensive.