The cost of the ongoing United States military campaign against Iran has risen to an estimated $25 billion, highlighting the scale of the deepening conflict between the two countries.
Meanwhile, global oil prices jumped to around $119 a barrel yesterday amid growing fears of supply disruptions sparked by the crisis, with tensions in the Middle East continuing to roil energy markets.
Moreover, US President Donald Trump yesterday insisted that the blockade on Iran will remain in place until it agrees to renegotiate its nuclear programme, signalling a likely prolonged standoff with significant implications for global stability.
In Nigeria, the effect was almost immediate, with the Dangote Refinery increasing the ex-depot price of petrol to N1,275 per litre, an increase of N75 per litre at the depot, reflecting the rise in crude prices and associated supply costs.
The U.S. war in Iran has cost $25 billion so far, a senior Pentagon official, Jules Hurst, said Wednesday in the first official estimate of the price tag for the military’s involvement in the conflict.
With just six months to go until mid-term elections in which Trump’s Republicans may have an uphill battle to retain their House majority, Democrats are high in public opinion polls as they try to link the unpopular Iran war with affordability.
“Most of that money was for munitions,” Hurst, who is performing the duties of the comptroller, told lawmakers on the House Armed Services Committee. Hurst did not specify what that cost estimate included, or whether it accounted for the projected costs of rebuilding and repairing damaged base infrastructure in the Middle East from the conflict.
Rep. Adam Smith, the top Democrat on the House Armed Services Committee, said in a statement responding to Hurst: “I’m glad you answered that question. That’s because we’ve been asking for a hell of a long time, and no one’s given us the number.”
The United States began striking Iran on February 28 and the two sides are currently in a shaky ceasefire. The Pentagon has added tens of thousands more forces to the Middle East, including maintaining three aircraft carriers in the region.
13 US troops killed in the fighting, hundreds wounded.
“The disruption of oil and natural gas shipments since the war started has driven up US petrol prices and agricultural products such as fertilizers, adding to the long list of other high consumer prices, a Reuters report said.
The US and Israel’s war against Iran on February 28 has seen petrol prices spike and Trump’s popularity take a hit. A recent Reuters/Ipsos poll found that just 34 percent of Americans approve of the U.S. conflict with Iran, down from 36 percent in mid-April and 38 percent in mid-March.
Brent crude, meanwhile, rose to $119 a barrel on Wednesday afternoon, the highest price so far this month and a near-7 per cent rise in a day.
Iran has said it will continue to disrupt traffic passing through the Strait of Hormuz in retaliation for the US blockade.
Oil prices have swung wildly since the war began as the key Strait of Hormuz has been effectively shut down for weeks because of the conflict, a BBC report said.
Iran has severely restricted shipping through the strait which normally carries about a fifth of the world’s supply of oil and liquid natural gas in reaction to US and Israeli strikes which began about two months ago.
Earlier this month, Tehran warned it would target any vessel approaching the strait. The US then said its forces would intercept or turn back ships travelling to or from Iran’s ports.
Analysis by BBC Verify showed that at least four vessels tracked from Iranian ports seem to have crossed the US blockade line. Although oil has seesawed in recent weeks, it is still priced far above its pre-conflict level per barrel.
On April 17, a ceasefire between Israel and Lebanon was announced and the price of Brent crude fell to $90 a barrel. On 8 April, the US announced that it was suspending its attacks on Iran. And it is still much higher than the pre-conflict price of a barrel.
But the oil benchmark has been climbing steadily in the last 12 days as the US has kept up its blockade.
Moreover, Iran’s economy is in the throes of a deepening crisis, with prices soaring, the currency losing value, and the possibility of oil exports coming to a halt. Annual inflation reached 53.7 per cent, the Statistical Centre of Iran said. The country’s currency, the rial, has slumped to a record low.
Last week the Iranian government said that the war had directly or indirectly cost around 2 million Iranians their jobs.
Trump called on Iran to “get smart soon” and sign a deal Wednesday, after days of impasse in efforts to end the conflict. Trump said in a post on Truth Social that the country “couldn’t get its act together.”
Citing U.S. officials, The Wall Street Journal said the president had ordered aides to plan an extended blockade of Iranian ports to pressure Tehran.
Trump had chosen to continue the blockade, which squeezes Iran’s economy and oil exports, as his other options – resuming bombing or walking away from the conflict – carried more risk, the report said.
Iranian officials said on Tuesday the country could sustain the blockade as it was using alternative trade routes.
Energy prices would leap 24 per cent in 2026 to their highest since Russia’s full-scale invasion of Ukraine four years ago if the worst disruptions from the Iran war end in May, the World Bank forecast on Tuesday.
European stocks declined on Wednesday as investors absorbed a slew of corporate earnings and awaited the latest interest rate decision from the US Federal Reserve.
“US President Donald Trump said Wednesday he has rejected the Iranian proposal of lifting the US blockade and opening the Strait of Hormuz.
He wants some guarantees first on reining in the Iranian nuclear programme, telling Axios in a phone interview that “they can’t have a nuclear weapon”.
“The blockade is a little more effective than the bombing. They are choking like a stuffed hog. And they will be worse off. “They can’t have a nuclear weapon,” Trump added.
Trump lauded the effectiveness of the blockade but declined to discuss any possible military plans in the interview.
They want to make a settlement, They don’t want me to hold the blockade. “I don’t want to (lift the blockade) because I don’t want them to have a nuclear weapon,” he said.
Meanwhile, the Dangote Refinery has raised its ex-depot price for petrol by N75 per litre, a move that will surely impact on the prices of fuel at the pumps across the country.
Petroleumprice datang shocked the downstream further as it increased its loading price for petrol from N1,200 per litre to N1,275 per litre, while coastal supply prices rose to N1,215 per litre.
