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US-Iran war escalates as Washington says conflict has cost $37.5bn, fresh strikes hit Tehran

by Emerald News Reporter
July 22, 2026
in Special Report
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The conflict between the United States and Iran intensified on Wednesday after fresh American airstrikes reportedly targeted military sites across Iran, triggering air defence systems in and around the capital, Tehran. The latest attacks came as US President Donald Trump declared that Washington was “not finished” with its military campaign, even as the financial cost of the war climbed to an estimated $37.5 billion.

According to US military officials, the latest operation marked the eleventh consecutive night of strikes aimed at weakening Iran’s military capabilities and reducing its ability to threaten commercial shipping through the Strait of Hormuz, one of the world’s most strategically important oil routes.

The conflict has expanded beyond the Strait of Hormuz, raising fears that instability could spread across the wider Middle East and further disrupt global energy supplies. Regional tensions have also increased following threats from Iran-backed Houthi forces to target Saudi Arabia’s ports, creating fresh concerns for international trade and oil markets.

Despite the continued military operations, US Secretary of State Marco Rubio said Washington remains open to diplomacy. Speaking during a regional meeting in Manila, Rubio said the United States is prepared to negotiate but accused Iran of failing to take the talks seriously.

Iran, however, maintained that indirect diplomatic contacts with the United States are still ongoing through mediators. Iranian Foreign Ministry spokesman Esmaeil Baqaei said communication channels remain open despite the worsening military confrontation.

Meanwhile, Pentagon officials disclosed that the war has already cost the United States approximately $37.5 billion, prompting debates in Washington over additional military funding. Defence Secretary Pete Hegseth defended requests for further spending, arguing that continued operations are necessary to protect American interests and maintain security in the Gulf region.

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President Trump also warned that future operations could target Iran’s underground nuclear facilities, including the heavily fortified Pickaxe Mountain complex near Natanz, which Western intelligence agencies suspect is linked to undeclared uranium enrichment activities.

Iran responded with strong warnings, saying any further escalation would be treated as a broader regional war. Military officials threatened retaliation against American interests and those of its allies if additional attacks are carried out.

The conflict has already spilled into neighbouring countries. Kuwait reported engaging drones believed to have originated from Iran, while Bahrain and Jordan said they intercepted missiles and drones during recent attacks. Iran claimed it targeted US military assets in Kuwait and Bahrain, including radar systems and air defence installations.

The situation has also raised concerns over global shipping after reports of explosions involving oil tankers near the Strait of Hormuz and the Gulf of Oman. Maritime security analysts warn that continued attacks on commercial vessels could significantly disrupt international energy markets and increase global oil prices.

As fighting enters its fifth month, international observers continue to urge both sides to return to negotiations to prevent a wider regional conflict that could have lasting economic and humanitarian consequences.

Tags: IranUnited States
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