Pentagon Auditors Say the Iran War Has Cost $33 Billion. The Real Price Tag Is Far Higher.

Shortly after the United States launched into a war with Iran, White House economic adviser Peter Navarro boldly proclaimed that the conflict would “lower energy prices.”

More than six months later—with the war still raging on and the Trump administration ignoring congressional demands to end it—that’s turned out to be as laughably false as the promise that the whole thing would be wrapped up in a few weeks.

Diesel fuel prices hit record highs this week, a direct consequence of the supply chains that have been disrupted by the war. Earlier this month, Brown University estimated that Americans had already paid more than $100 billion in higher gasoline prices due to the war—and that was before the surging prices that are now hitting after attacks last week on a key Saudi pipeline.

Higher fuel prices are the most direct way that most Americans are feeling the cost of the war, but that’s hardly a full accounting.

Neither is the eye-popping figure reported by the Pentagon’s inspector general this week. In a report released Tuesday, auditors pegged the cost of “Operation Epic Fury” at $33.4 billion, including the $22.3 billion worth of munitions that have been fired off since February 28.

But that tally only covers the first four months of the war—through June 29. It also “does not include costs for infrastructure repairs,” the audit notes.

The war’s impact on infrastructure across the region is becoming more obvious. “Hundreds of buildings and structures” on American military bases have suffered significant damage from months of Iranian drone and missile attacks, the inspector general report concludes.

Civilian infrastructure has taken a pounding too. This week, Amazon said that data centers in Bahrain and the United Arab Emirates were damaged beyond repair. And then, of course, there are the crucial oil and energy supply chains—which bring us back to the higher costs on the home front.

According to the Congressional Budget Office (CBO), the war with Iran was responsible for “roughly 40 percent” of the inflation that Americans experienced during the second quarter of this year. Much of that is due to rising gas prices, which affect not only the price you pay at the pump but also add to the cost of shipping just about anything.

The war has also contributed to rising interest rates. The CBO estimates that the war has pushed interest rates up by 0.2 percent, and it expects those rates “to remain higher for several quarters.” The CBO now expects inflation in early 2027 to be about 0.5 percent higher than it previously anticipated.

As if to confirm that assessment, the Federal Reserve voted Wednesday to hike its benchmark interest rate by 25 basis points. In a statement released after the decision, the Federal Reserve Board said the action was taken because “inflation remains elevated.”

All signs point back to the Iran War. It is costing taxpayers billions in direct costs. It is making gasoline and other fuels more expensive, which adds to inflation throughout the economy. It is nudging interest rates higher, making everything from mortgages to credit card payments less affordable. It has led to the deaths of 18 Americans and hundreds, if not thousands, of Iranians.

If the Iran war cost only $33 billion, it would be a travesty. The real price tag is, unfortunately, much higher.