CBO puts the Iran war at $38 billion through 1 August

The Congressional Budget Office estimated on 15 September 2026 that the United States had spent $38.1 billion on the Iran war through 1 August. The 19-page note said the fighting would cost another $2 billion to $3 billion each month if it continues at recent intensity, and that rebuilding spent munitions could take at least five years.

CBO prepared the assessment at the request of Representative Brendan Boyle, the senior Democrat on the House Budget Committee. The Defence Department did not answer the office’s information requests. Analysts therefore used government databases and public reporting. The total is close to Defence Secretary Pete Hegseth’s Senate figure of $37.5 billion and sits a few billion above a Pentagon inspector-general tally of $33.4 billion through the end of June.

Where the $38 billion went

Replacement of expended munitions is the largest line at $21.7 billion. Inside that line CBO put $13.1 billion on interceptors, $7.3 billion on land-attack cruise missiles and $1.2 billion on other munitions. The rest of the $38.1 billion covers equipment lost in battle, extra flying hours, higher operating tempo and dearer fuel.

Two costs are missing on purpose. The office did not price American dead and wounded, and it did not price long-run veterans’ care. It also did not add damage to bases. Those omissions mean the $38.1 billion is a floor on the Pentagon ledger, not a full social cost.

Monthly burn depends on the month you pick as the template. At the intensity of May and June, CBO said about $2 billion. At July’s intensity, about $3 billion. “Monthly costs would be higher if the conflict intensified further or DoD used expensive munitions,” the report said.

Inflation and the strait

CBO also said the war would keep inflation about 0.5 percentage points higher than its previous path into the first quarter of 2027. The channel is energy and freight. Less oil and gas moving through the Strait of Hormuz, and disrupted traffic in the Red Sea, feed into the same price pressure the Federal Reserve cited when it raised rates on 16 September.

That link is why a war-cost memo landed in the same news cycle as a quarter-point hike. The Fed’s statement pointed at energy. CBO pointed at the same waterway and put a dollar figure on the munitions side of the ledger.

Stockpiles as the binding constraint

Five years to refill interceptor magazines is the sentence that will travel farthest inside the building. Interceptors are not generic. They are long-lead items. A war that spends $13.1 billion of them in five months is consuming inventory faster than industry can replace it. Hegseth’s earlier testimony and the inspector-general report had already described the same squeeze. CBO put a clock on it.

The political use of the paper is straightforward. Boyle and other Democrats will cite $38 billion and $3 billion a month as midterm arithmetic. The administration will cite Hegseth’s matching number and argue that the alternative to the spend is a worse energy shock. Neither argument changes the industrial fact CBO wrote down: the magazine is shorter than it was in February, and the refill is measured in years.

The war began in late February. By 1 August the scorekeeper’s best public number was $38.1 billion, with most of that sum sitting on missiles that have already been fired.