The financial cost of the Iran war is becoming clearer as, according to the latest study by the Institute for Economics and Peace, the conflict is costing the global economy $2.2 trillion in annual GDP.
The US alone had spent $25 billion within two months of the war beginning, and sought a further $200 billion from Congress to continue operations. Economists estimate the long-term cost at around $1 trillion.
That cost does not stay on a balance sheet. It moves through supply chains, interest rates, insurance premiums and shipping costs until it arrives in grocery bills, fuel prices and mortgage repayments for households around the world.
In the latest episode of Business Extra, host Salim A. Essaid speaks with Steve Killelea, founder and executive chairman of the Institute for Economics and Peace, about how a war in the Middle East ends up affecting ordinary people, which costs hit hardest and fastest, and what $2.2 trillion back in the global economy would actually look like for the people who never had a say in the decision to go to war.
![A damaged car and a damaged building are seen at the site of a strike in Bartalla in the northern Iraqi Nineveh province on July 29, 2026. US-Saudi strikes on Iraq on July 29 killed at least 20 members of a former paramilitary alliance that includes pro-Iran groups, the alliance said. The United States and Saudi Arabia said they had struck Iran-backed militants in Iraq in response to attacks on US forces and Saudi oil facilities. (Photo by Zaid AL-OBEIDI / AFP) / Attention editors: AFP covers the war in the Middle East through its extensive regional network, including bureaus in Tehran, Jerusalem and several neighboring countries. Since the start of the conflict, journalists have been working under increasingly restrictive conditions. Authorities in several countries have limited reporters’ movements, photo and live video coverage from sensitive locations. Some governments and armed groups have banned images of missile or drone strikes and other security-related sites. / “The erroneous mention[s] appearing in the metadata of this photo by Ziad OBEID has been modified in AFP systems in the following manner: corrects byline [Zaid AL-OBEIDI] instead of [Ziad OBEID]. Please immediately remove the erroneous mention[s] from all your online services and delete it (them) from your servers. If you have been authorized by AFP to distribute it (them) to third parties, please ensure that the same actions are carried out by them. Failure to promptly comply with these instructions will entail liability on your part for any continued or post notification usage. Therefore we thank you very much for all your attention and prompt action. We are sorry for the inconvenience this notification may cause and remain at your disposal for any further information you may require. ”](https://www.thenationalnews.com/resizer/v2/PLSC2TSQZTFNYGSCPBJVUPIB2I.jpg?smart=true&auth=b0d3bd2d2b21bfcd8f9d5a89db763ef91727ee31e46f2bd5651027a66d97a8f5&width=188&height=104)
