America
Iran war costs US economy $265 billion as household burden mounts
The economic toll of the conflict on the US has reached $265 billion in the roughly eight months since the start of joint US and Israeli strikes against Iran.
According to calculations by Moody’s Analytics Chief Economist Mark Zandi, this amount imposes an additional burden of approximately $2,000 on the budget of an average American family.
Sharing data on his X account on Tuesday, Zandi noted that the cost per household since the war began stands at about $2,000, with nationwide economic losses reaching $265 billion.
This estimate is seven times higher than the direct military spending figure reported to Congress by Secretary of War Pete Hegseth, which covers the period between the start of the strikes on 28 February and the end of July.
While Hegseth’s official figures cover only direct military operations, the conflict’s impact on global markets and oil prices is driving up inflation and day-to-day living costs, deepening the real burden on household budgets.
Fuel and heating costs strain budgets
Energy items account for the largest share of the additional expenses facing American households. The surge in fuel, home heating, and transport costs has generated an extra bill of about $1,100 per family.
Zandi noted that the price of regular petrol, which hovered just below $3 per gallon before the war, has risen to $4.37, while diesel has exceeded $6 and jet fuel has nearly doubled.
Pointing out that a marked rise in residential heating fuel costs is driving up spending as winter approaches, Zandi said current price levels continue to add roughly $50 a week to family budgets.
Researchers at Brown University’s Watson Institute for International and Public Affairs are also tracking the impact of rising fuel prices on consumers.
According to data from the institute, US consumers have paid an extra $133.3 billion for fuel products since 28 February.
During this period, petrol prices rose by more than 46% and diesel climbed by over 70%. Of this additional burden borne by consumers, $73.5 billion stemmed from petrol and $59.8 billion from diesel. This calculation translates into an extra cost of $1,017.76 per household nationwide.
Loan interest rates and operational outlays inflate the bill
Another decisive factor in the economic picture has been the rise in interest rates.
Zandi reported that climbing interest rates have created a cost of approximately $540 per household.
Fixed-rate home mortgage rates, which stood below 6% before the war, have climbed to roughly 7.5%, Zandi said, adding that long-term rates have also increased substantially.
Direct military operations, meanwhile, represent a cost of $360 per household based on Pentagon data.
However, experts point out that repair, maintenance, and equipment replenishment expenses are excluded from the published figures, meaning actual military spending on the ground could exceed Pentagon estimates.
Linda Bilmes, a war budget specialist who teaches public policy at Harvard Kennedy School, said she is certain the conflict’s bill will reach $1 trillion, adding, “Maybe we’re already there.”
Trump defends spending as public support drops
The mounting economic strain is fuelling backlash against the military campaign and US President Donald Trump’s handling of the process.
A Pew Research Centre survey conducted on 28 September-4 October among 5,062 adults revealed that 65% of Americans disapprove of the way Trump is handling the Iran strikes.
The proportion of those who consider the use of military force justified dropped four percentage points compared with March, falling to 34%.
Emphasizing that the total cost has wiped out roughly half of the average American household’s income gains over the past eight months, Zandi said it is natural for public support for the war to remain so low.
According to figures shared by pollster Nate Silver, Trump’s net approval rating has tumbled to an all-time low of minus 23.5 points.
Defending the military intervention against Iran, Trump described the costs as “a small price to pay to keep our country and the world safe.”
With the surging cost of living piling pressure on Republicans ahead of the November midterm elections, Trump announced last month that he would provide a $5,000 cash payment to every adult in the country if his party maintains its majorities in both chambers of Congress.
America
US fines Bank of America $1.21bn over money laundering and sanctions
The US Department of the Treasury has imposed a total of $1.21 billion in financial penalties on Bank of America, one of the country’s largest financial institutions, for violating anti-money laundering legislation and sanctions regimes.
According to a statement published by the department, the bank was accused of failing to report suspicious transactions in a timely manner, failing to monitor financial movements that posed national security risks, and providing services to clients on sanctions lists.
Decisions by units operating under the Treasury Department accounted for the largest components of the penalty package.
The Financial Crimes Enforcement Network (FinCEN) penalised the bank for failing to report more than $5 billion in suspicious transactions in a timely manner.
More than $1 billion of that amount was noted to be directly linked to national security risks, including the operations of China-based money laundering networks.
Under the settlement reached with FinCEN, Bank of America admitted to willfully violating the Bank Secrecy Act. The bank was required to conduct an additional review covering suspicious transactions and to assess the effectiveness of its financial monitoring system.
The Office of the Comptroller of the Currency (OCC) separately fined the bank $750 million over structural deficiencies in its financial monitoring system.
The OCC stated that the bank failed to maintain adequate oversight over trillions of dollars in fund transfers and did not remedy the violations despite a formal notice served in December 2024.
The Office of Foreign Assets Control (OFAC) also stepped in over millions of dollars in transactions carried out in breach of sanctions regulations. OFAC reached an $11.6 million settlement agreement with Bank of America concerning 475 distinct potential sanctions violations.
Assessing the matter, US Treasury Secretary Scott Bessent said, “The actions taken today send a clear message that even the largest financial institutions are not above the law.”
UK fines banks over breaches of Russia sanctions
Alongside the penalty decision in the US, similar sanctions scrutiny is being carried out across European financial centres.
In September, the Office of Financial Sanctions Implementation (OFSI), an agency of the UK Treasury, fined Citibank’s London branch (CBNA London) £4.7 million for violating sanctions targeting Russia.
According to findings by the British regulator, between February and November 2022 following the outbreak of armed conflict between Russia and Ukraine, the bank processed 970 payments worth a combined £19.7 million, circumventing asset freezes and other restrictions. The government stated that the majority of the violations were linked to corporate accounts owned or controlled by sanctioned individuals. Russia, meanwhile, describes sanctions imposed by Western nations as illegal.
During the spring, OFSI also fined the London branch of Germany’s Deutsche Bank £165,000 ($221,000) for transferring funds to the Russian online streaming platform Okko.
Over the same period, the watchdog imposed a £390,000 fine on Apple’s European entity, Apple Distribution International (ADI), for a similar violation.
America
Musk boosts Republican midterm funding despite pledge to curb spending
The world’s richest person, Elon Musk, has donated $276 million over the past three months to political action committees and conservative organizations supporting Republicans ahead of the upcoming US midterm elections.
The latest transfer brings the total midterm donations from Musk, the chief executive of Tesla and SpaceX, to $366 million.
First reported by The New York Times, the figures were confirmed to The Hill by a spokesperson for America PAC, which Musk founded. These latest expenditures establish Musk as the largest known donor of the 2026 midterms.
The bulk of Musk’s financial backing between July and September was directed towards congressional races.
The US billionaire transferred $158 million to the Senate Leadership Fund, a super PAC supporting Republican Senate candidates, and $20 million to the Congressional Leadership Fund, which finances House Republicans.
Millions divided among various committees
Musk, who provided more than $76 million during the period to America PAC, an entity he founded during the 2024 election cycle, also funded state-level contests.
The businessman transferred $10 million to the Lone Star Liberty PAC, which supports Texas Republican Senate candidate Ken Paxton, while donating $10 million to the Republican Governors Association and $2 million to the Republican Attorneys General Association.
In statements given to The New York Times and confirmed by The Hill, America PAC spokesperson Andrew Romeo argued that if Democrats take control in Washington and win critical state races, the country faces the risk of becoming one with indefensible borders.
Romeo said the investments enable the Republican apparatus to deliver its messages to voters.
Field spending continues despite talk of retreat
Musk, who kept his distance from politics for many years, entered the arena by spending hundreds of millions of dollars for Donald Trump during the 2024 election.
Accompanying Trump on campaign trails, Musk subsequently took charge of the Department of Government Efficiency (DOGE), which sparked controversy through federal employment and budget cuts.
Musk stepped down from his White House role in late May 2025 and remained politically quiet for months following a public rift with Trump.
After announcing last May that he would sharply scale back his political spending, Musk told The Economist in a July interview that he had become overly involved in politics and had gone too far.
Despite those remarks, Musk pressed ahead with political activity in July by authorizing America PAC to spend between $100 million and $120 million on a fresh field operation aimed at driving conservative voter turnout in the 2026 midterms.
Having repaired ties with Trump following their public spat, Musk joined the US president on an official visit to China in May and was also present during Chinese President Xi Jinping’s visit to Washington last month.
America
Trump weighs presidential memorandum to cut surging US diesel prices
US President Donald Trump is reportedly preparing to issue a new presidential directive soon in a bid to rein in escalating diesel prices across the country.
According to a report by the Reuters news agency citing three oil industry sources, the White House is weighing the enactment of the prepared package of measures directly in the form of a presidential memorandum.
The memorandum in question will reportedly instruct multiple US federal agencies to find and implement ways to lower diesel fuel costs, primarily by expanding oil extraction operations and refinery output.
White House plans to deploy Defense Production Act
According to information shared in the report, the Trump administration is exploring legal avenues to overcome restrictions imposed on energy production by state administrations and local government authorities.
The administration could reportedly invoke the Cold War era Defense Production Act to that end.
The legislation in question grants the US president the authority to provide state loans and financial guarantees to expand the production of materials of strategic importance. The law also makes it possible to require private companies to prioritise government orders.
Reuters reported that the White House is comprehensively examining the prospect of putting this legal mechanism into effect.
In contrast, oil refinery executives were noted to have made a recommendation to government officials last month.
Industry representatives suggested allocating federal budget resources toward modernising existing operational refineries and expanding their capacity, rather than establishing new facilities from scratch.
Plant managers stated that building new facilities would require substantially more time and higher costs.
The Wall Street Journal newspaper also highlighted in a report published in mid September that US-based oil companies were warning of the onset of a global fuel crisis.
The newspaper noted that during the period in question, diesel prices broke records, whilst the price per barrel of crude oil approached the $101 mark.
American Automobile Association (AAA) data show that as of Thursday, 8 October, the average diesel fuel price nationwide stood at $6.28 per gallon (approximately 3.8 litres).
High fuel costs pose risk ahead of congressional elections
It was pointed out that the increase in diesel fuel prices creates political risks for the Republican Party ahead of the congressional elections to be held on 3 November.
It was noted that the outcome of the vote will determine whether Republicans can maintain their majority in Congress.
Because diesel is heavily consumed in freight transport, the agricultural sector, and home heating in particular, price rises in the fuel were stressed as driving headline inflation higher.
Trump previously announced that he had reached an understanding with Russian President Vladimir Putin regarding the supply of Russian diesel fuel to both the American and global markets. The US president also thanked Putin for the arrangement concerning Russian diesel.
The US Department of the Treasury extended a temporary waiver licence permitting commercial transactions involving Russian diesel fuel until 7 April 2027.
Under the delivery schedule shared by Donald Trump, Russia will immediately ship more than 300,000 tonnes of fuel.
Shipments will reportedly continue with 500,000 tonnes in November, followed by the delivery of an additional 1 million tonnes of fuel. Over the remainder of the process, Moscow could send a further 3 million tonnes of diesel depending on the overall technical condition of refineries.
Following the announcement of the consensus between the two leaders, US diesel futures fell by approximately 5% to reach $4.64 per gallon.
Meanwhile, energy analysts consulted by Reuters express doubt as to whether the additional shipments arriving from Russia will suffice to secure a lasting price decline across the markets.
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