Global Economy — 2026-05-11

Analysts Say Iran War Cost Far Exceeds Pentagon's $25 Billion Estimate

At an April 29 House hearing, acting Pentagon Comptroller Jules Hurst III put Operation Epic Fury's cost at $25 billion, covering munitions and operations but excluding damaged equipment and destroyed bases. U.S. officials familiar with internal Pentagon assessments told CBS News the figure is closer to $50 billion, with 24 lost MQ-9 Reaper drones among the unseen replacement costs. In a May 6 Popular Information analysis, Stephen Semler of the Security Policy Reform Institute calculated $71.8 billion for the first 60 days, incorporating $11.9 billion in combat losses and U.S. military aid to Israel. Brown University's Watson School separately estimates economic costs above $37 billion, including over $20 billion in higher gasoline prices since the war began on February 28.

Analysis
The Pentagon's official tally understates cost by logging expended munitions at original procurement prices rather than replacement costs; the SM-2-to-SM-6 substitution alone registers a fivefold unit-cost gap that appears as savings. Semler's $71.8 billion 60-day estimate, resting on named-analyst methodology and procurement data per Popular Information, carries stronger footing than the CBS-reported $50 billion from unnamed officials because it captures $11.9 billion in combat losses and State Department aid to Israel that both official figures exclude. The acting comptroller's committed supplemental is likely to approach $80–100 billion at current-production prices. Independent estimates may overstate the Pentagon's direct liability by bundling Israeli aid and economic spillovers that would partly have occurred regardless, placing the audited military-only total nearer the $38–47 billion Penn Wharton range.

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How much has the Iran War actually cost? A lot more than $25 billion. - Reason