Moody’s: War in Iran has cost the average US household $2,000 — The Hill

The war in Iran has already cost the average US household about $2,000, according to estimates shared by Moody’s Analytics chief economist Mark Zandi. As The Hill reports, the total costs to US consumers since the conflict began in late February have reached $265 billion.

Fuel became the main expense

Higher energy prices had the greatest impact on household spending, Zandi said. According to his calculations, fuel costs and higher prices for goods transported by trucks or planes account for nearly $1,100 per household.

The price of a gallon of gasoline rose from $2.98 to $4.34, The Hill writes, citing CNN. According to the American Automobile Association, the average price of diesel fuel approached $5.80 per gallon, compared with $3.10 a year ago.

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Higher rates and military operations

Zandi’s calculations also take into account the Federal Reserve’s decision to raise interest rates. Rates on fixed-rate mortgages increased from less than 6% to about 7.5%, which, according to the economist’s estimate, cost the economy about $540 per household.

Another approximately $360 per household is attributable to military operations. In May, acting Pentagon chief financial officer Jules Hurst III told lawmakers that spending on the conflict was approaching $29 billion.

At the end of June, the American Enterprise Institute estimated the cost of operations at $38.6 billion, while the Center for Strategic and International Studies put it at about $40 billion. In June, the White House also requested $87 billion in additional funding to replace part of the stockpiles and deploy troops in the US Central Command area of responsibility.