US Energy Consumers Have Spent $121 Billion Extra Since Trump Launched Iran War: Moody's
With that additional $930 per household spent on energy, the analysis says the total cost due to higher prices from the war is closer to $1760.
A recently published economic analysis estimates that President Donald Trump’s illegal war with Iran has cost US consumers an average of $1,760 per household—including a total of $121 billion in extra spending on energy alone—since the conflict began less than 8 months ago.
The war, which Trump launched without congressional authorization in February, has sent energy prices spiking across the world, as Iran responded to US attacks by shutting down commercial shipping traffic in the Strait of Hormuz.
According to the estimate by Moody’s Analytics, US consumers have spent over $121 billion—or $930 per household—more on energy since the start of the war, accounting for more than half of the total added expenses imposed by the conflict.
Mark Zandi, chief economist at Moody’s, told CNBC in an interview published Wednesday that the analysis reflects the fact that "consumers are under a lot of financial pressure."
The analysis also finds that the average US household has spent an additional $425 due to higher interest rates caused by the war, as well as $405 for higher military spending, which Zandi explained to CNBC would come from footing the bill through either national debt expansion or increased taxes.
Karthik Sankaran, senior research fellow in geoeconomics at the Quincy Institute for Responsible Statecraft, argued in an analysis published Thursday that relief for US energy consumers could be a long way off given recent developments in the Middle East, including Houthi fighters seizing a key port city along the Red Sea and a drone strike on a Saudi oil pipeline.
Sankaran warned that nations worldwide have far fewer options now to cushion against energy shocks than they did at the start of the war.
"Seaborne storage on tankers has been depleted," Sankaran wrote, "the US Strategic Petroleum Reserve has released about 130 million barrels, and the world’s largest importer, China, is increasing imports to 7.2 million barrels per day, up from a low of 6 million barrels in June."
Sankaran noted that, as uncomfortable as high energy prices are for Americans, the situation is even more dire in the Global South.
"The spike in diesel prices is likely to hit countries in the Global South especially hard," Sankaran explained. "The higher energy density of diesel means that it is used to power trucks, buses, and agricultural equipment, making it the most important fuel in poorer countries where individual ownership of automobiles is much less widespread."
A Tuesday report from CNN highlighted how high fuel prices have led to protests across the globe, including in Syria, Guatemala, France, Portugal, and the Philippines.
The protests in Syria have been particularly intense, CNN noted, as demonstrators on Sunday "blocked the Hasaka–Deir ez-Zor highway, where they burned tires and stopped oil tankers."
Muaz Al Abdullah, Syria analyst at global conflict monitor Armed Conflict Location and Event Data (ACLED), told CNN that "fuel availability, rising prices, falling purchasing power, and poor services are all reasons that have accumulated public resentment," which have led to demands that the country oust its energy minister.
