The US-Iran war, now in its sixth month, has already cost the United States nearly $40bn, with the Pentagon requesting an additional $67bn. Oil prices have surged over 40% since before the conflict, and gasoline prices in the US have risen 37%, with diesel up 40%. In the UK, gas prices have jumped nearly 50% in just one month. These figures, reported by the Guardian, underscore the global economic toll of a war that has expanded from the Gulf to the Red Sea, with Houthi blockades threatening shipping chokepoints.
War of attrition and sunk costs
The conflict, which began with US airstrikes on Iran, has escalated into a stalemate. Iran has struck US bases across the region, and the Houthis have claimed a blockade over a second shipping chokepoint. The US has lost 18 troops, and the Pentagon is accused of undercounting casualties. President Trump, who launched the war without defensive justification, is now trapped: he cannot withdraw without losing leverage over the Strait of Hormuz, nor can he escalate with ground troops without risking a bloody campaign. The White House’s fiscal year request for Congress is a colossal $1.5tn, choking domestic spending on programs like daycare, Medicaid, and Medicare, according to Trump’s own statements.
Global economic shockwaves
The war has caused a global energy reconfiguration. Brent oil prices are nearly 40% higher than before the war, and energy prices are up across the board. Protests over rising costs have erupted worldwide, from Ireland to Kenya. In Nairobi, protesters set tyres alight during a nationwide transport strike over fuel prices on 18 May 2026. The economic strain is compounded by Trump’s new tariff regime, imposed on the grounds that countries are not doing enough to tackle forced labour. Critics, including Nesrine Malik writing for the Guardian, describe the tariffs as a risible excuse that adds to the cumulative impact of the war.
No end in sight
Malik argues that the war is a symptom of Trump’s chaotic leadership: “He’s commander-in-chief of chaos. Now we’re all victims of Trump’s wars.” The war has already cost Iran’s civilians and infrastructure, Gulf countries’ economies and drinking water, as Iran strikes desalination plants. The US is “yoked to US hegemony,” Malik writes, and everyone pays the cost of a war that has no defensive features and is run by a “frat house of bullies and lickspittles.” The conflict shows no signs of abating, with phantom breakthroughs and threats of final escalation giving way to a chilling reality: an exorbitant war that is rearranging geopolitics, domestic budgets, and household finances.
