U.S. Operations in Iran Cost More Than $47 Billion, According to Pentagon Data
Key Facts
U.S. military spending on operations in Iran exceeded $47 billion through October 27, according to Pentagon data obtained by Reuters. The data have not been made public, the report said. The estimate is more than 25% above the Defense Department’s estimate issued in July. The figure comes as Washington continues to impose a naval blockade on Iran while leaving open the possibility of resuming combat operations. It represents the military expenses related to the war, as reported, while the estimated cost of repairing damage to U.S. bases does not appear clearly in the calculations.
The cost of replacing munitions used in the conflict exceeds $29 billion, according to Reuters’ breakdown. The cost of replacing military equipment and losses of platforms, including aircraft and drones, is also more than $6 billion. The Associated Press said munitions accounted for more than half of total costs in the breakdown by U.S. Central Command, with defensive interceptors, including Patriot and THAAD, among the weapons most in demand. Operating costs also include air operations and cyber support. But estimates for repairing damage to bases did not appear clearly in the cost calculations, while a report by the Pentagon inspector general said hundreds of buildings and facilities at U.S. bases in the region were damaged or destroyed.
The report says the U.S. strategy began by using costly precision missiles to strike Iranian defenses, paving the way for the use of less expensive munitions, such as guided bombs. It also said the April ceasefire gave Iran time to move stockpiles out of underground storage and reactivate some defenses, missiles and drones that had been inaccessible. These details provide context for the distribution of spending among munitions, platforms and operations, amid the continued need to replace what forces used or lost. The Congressional Budget Office estimated the cost of the war at $38 billion through August 1, according to the Associated Press. The office said additional expenses could reach about $3 billion per month, depending on the intensity of the conflict.
In energy markets, Brent futures settled at $113.88 a barrel on October 27, down $1.93, or 1.8%. West Texas Intermediate ended the session at $99.90 a barrel, down $1.86, or 1.83%. Reuters linked oil’s move to traders’ focus on Middle East talks, while concerns persisted about the possibility of renewed fighting. The price moves place the cost of operations in the context of an energy market affected by developments in the region, without in themselves determining the impact of military spending. In the United States, new orders for durable goods rose by $6.3 billion, or 1.8%, in September to $345.4 billion, after increasing 0.1% in August.
Durable goods orders excluding transportation rose 0.5% in September, while orders excluding defense increased 2.2%. The Census Bureau released the data on October 27 and set November 3 as the date for issuing the full report on manufacturers’ shipments, inventories and orders for September. On monetary policy, the Federal Open Market Committee meeting ran on October 27 and 28, while the Federal Reserve calendar listed the news conference for October 28 at 2:30 p.m. local time. The Bureau of Economic Analysis scheduled the release of September personal income and spending data, which include the personal consumption expenditures price index, for October 29 at 8:30 a.m. U.S. elections will also take place on November 3, and President Donald Trump has left open the possibility of resuming fighting after the midterm elections, while U.S. officials told Reuters that the Pentagon is planning to resume broad combat operations if ordered to do so.