More than 100 days after Trump started a war with Iran, American families are paying the price — at the pump, at the grocery store, and on their mortgage statements. Moody’s Analytics Chief Economist Mark Zandi calculates the war has cost U.S. consumers $100 billion — or $750 per household — through a combination of increased military spending and higher prices driven by oil supply disruption out of the Middle East. Inflation has hit a three-year high. Consumer confidence crashed to an all-time low. And experts warn that even with a deal signed, higher prices are here to stay.
Trump’s War on Iran Has Cost Americans Billions
- According to Moody’s Analytics, the war has cost U.S. consumers $100 billion – or $750 per household — driven by increased military spending and higher energy prices resulting from disruption to the Strait of Hormuz.
- Pentagon officials told the House Armed Services Committee at the end of April that the war had already cost $25 billion, most of which has been spent on munitions.
- Americans have paid $53 billion more to the oil industry since prices began rising at the war’s start, per ITEP’s running tracker.
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- Goldman Sachs calculates that higher gasoline prices represent a $140 billion annualized headwind to household incomes, and expects higher energy prices to “erode” consumers’ spending power through the rest of 2026, with lower-income households bearing a disproportionate share.
- The war has fully erased the household benefit of Trump’s tax cuts: as of May 16, the larger refunds Americans received “no longer cover the higher costs of gasoline, diesel, and jet fuel caused by the war,” according to Mark Zandi. Morgan Stanley found that a sustained 15% rise in gas prices was all it takes to fully offset the average tax refund bump — and prices have risen more than 35%.
- At current gas prices, Moody’s projects the average household could absorb nearly $2,000 in war-related costs in one year.
Trump’s War on Iran Is Hiking Oil & Gas Prices For Working Americans
- The average price of regular gasoline is $4.04 a gallon as of June 16 — up more than 35% from $2.98 the day before Trump launched airstrikes against Iran.
- Diesel stands at $5.19 per gallon as of June 16 — up nearly 47% since the war began — driving up costs for trucking, farming, and manufacturing across the economy.
- The average American is paying between $10 and $25 more with every fill-up because of Trump’s war.
- Even as a peace deal takes shape, experts warn relief at the pump will be slow because “Prices go up like rockets, and they come down like a feather.” An Oil Price Information Service analyst told Newsweek that Americans can kiss the pre-war $2.98 average “goodbye for the rest of 2026.”
Beyond The Pump: Trump’s War on Iran Has Spiked Costs for Essential Goods & Services
- INFLATION: May’s Consumer Price Index rose 4.2% annually — up from 3.8% in April and 2.4% before the war — the highest pace since April 2023. Energy prices drove the surge, up 23.5% year-over-year. When asked if he was concerned, Trump said: “I love the inflation.”
- HOUSING COSTS: Mortgage rates have climbed from below 6% before the war to 6.52% as of June 11 as war-driven oil prices pushed up inflation expectations and Treasury yields. Hopes for sub-6% rates in 2026 have faded entirely.
- FOOD COSTS: USDA now projects “food at home” prices will rise 3.1% in 2026 — nearly double its projection at the start of the year — as diesel and fertilizer costs cascade into grocery prices.
- AIRFARES: Airline fares have climbed more than 20% as jet fuel prices soared. According to Kayak, the average cost of a domestic ticket was $293 in January. That same fare has climbed to $383.
- CONSUMER CONFIDENCE: The University of Michigan Consumer Sentiment Index plunged to an all-time low of 44.8 in May — below levels seen during the 2008 financial crisis — as inflation fears mounted and gas prices squeezed household budgets. Sentiment remains 19% below a year ago, and consumers expect inflation to hit 4.8% over the next year.
- RECESSION RISK: Oxford Economics forecasts 2026 will bring the slowest annual consumption growth since 2013 (excluding the pandemic). Goldman Sachs raised its 12-month recession probability to 25% since the war began.
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