West Asia Conflict / US Bleeds USD 38 Billion as Iran War Drains Missile Stocks

Washington, Sep 16: Mounting costs and economic strain are beginning to define America’s confrontation with Iran.

A new analysis by the Congressional Budget Office (CBO) reveals that Operation Epic Fury has already drained tens of billions from the Pentagon’s budget while simultaneously eroding missile‑defence reserves, disrupting global energy flows, and fuelling inflation at home.

The report underscores how the campaign, reignited in July after tanker attacks in the Strait of Hormuz, is exacting not only a military toll but also a broader financial and strategic burden on the United States.

Also read: Iran Says Strait of Hormuz “Closed” after Super Oil Tanker Destroyed

Operation Epic Fury began on February 28, with its initial phase lasting until a ceasefire on April 8. President Donald Trump declared the ceasefire over on July 10 following attacks on tankers transiting the Strait of Hormuz.

The CBO’s $38 billion estimate includes $21.7 billion to replace missiles and other munitions, $10.4 billion in additional flying hours, $2.7 billion in higher military fuel costs, $1.9 billion for equipment lost in battle, and $1.5 billion in other operational expenses.

Replacing expended munitions was the largest single expense, with $13.1 billion spent on missile-defence interceptors and $7.3 billion on land-attack cruise missiles.

The report noted that the estimate excludes costs for repairing or rebuilding US military facilities damaged by Iranian attacks, as well as diplomatic operations, foreign assistance, and long-term medical care or disability compensation for injured service members.

CBO emphasized that its findings are subject to “considerable uncertainty” because the Pentagon did not provide requested data, forcing reliance on government databases and public reports.

CBO warned that the United States may have used between one-half and two-thirds of its missile-defence interceptor inventory since June 2025.

“Although DoD does not reveal the number of munitions it has on hand, a comparison of the reported expenditures of missile defence 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 report stated.

Rebuilding stocks could take at least five years, even with accelerated procurement.

“The shortfall would become especially problematic if a conflict arose with an opponent whose arsenal included large numbers of ballistic and cruise missiles,” CBO cautioned, specifically identifying China as a potential adversary in a Taiwan-related conflict.

Beyond military costs, the conflict has disrupted oil and natural gas shipments through the Strait of Hormuz and the Red Sea. CBO said the resulting energy price increases added 2.3 percentage points to the annualized inflation rate in the second quarter of 2026.

Inflation in the first quarter of 2027 is projected to be 0.5 percentage points higher than earlier forecasts, with rising inflation expected to push up interest rates on US Treasury securities.

Defence Secretary Pete Hegseth told Congress in July that operations against Iran would cost $37.5 billion through September. The White House has requested $87.6 billion in supplemental funding, including $67.1 billion for the Pentagon. CBO said about $42.3 billion of that request appeared directly related to the conflict.

This restructuring captures the fiscal, logistical, and economic dimensions of the campaign while highlighting the long-term strategic risks identified by the CBO.

(IANS)