'Israel' burning $200 mln daily in costly Iran response: WSJ

By Al Mayadeen English
Source: The Wall Street Journal
20 Jun 2025 14:14
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According to experts, the daily price tag of "Israel" launching interceptors may alone reach up to $200 million.

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Rescue teams work at the site where a missile launched from Iran struck Tel Aviv, occupied Palestine, Monday, June 16, 2025. (AP Photo/Baz Ratner)

The Wall Street Journal on Friday reported that "Israel" is facing a mounting financial burden as a result of its military confrontation with Iran, with estimates suggesting the cost of the war is draining the Israeli economy by hundreds of millions of dollars per day. The staggering expenses are raising doubts about "Israel's" ability to sustain a prolonged offensive.

Central to the cost is the deployment of high-end missile defense systems used to counter Iranian retaliatory strikes. According to experts, the daily price of launching interceptors alone may reach up to $200 million. Added to this are expenditures on munitions, aerial missions, and the extensive damage caused by Iranian missile strikes on Israeli infrastructure. Preliminary figures place the cost of reconstruction at no less than $400 million.

Though Israeli officials claim their military campaign may last two weeks, Prime Minister Benjamin Netanyahu has shown no sign of retreating before achieving long-standing political goals, such as dismantling Iran's defensive capabilities and its sovereign nuclear program, which is internationally monitored and confirmed to be peaceful.

But economic realities may force a rethink, according to WSJ. "The main factor which will really determine the cost of the war will be the duration," said Karnit Flug, former Bank of Israel governor. "If it is a week, it is one thing. If it is two weeks or a month, it is a very different story."

Deterrence costs rise

Iran's missile response, logging over 400 missiles launched in recent days, has exposed the immense cost of attempting to neutralize such deterrent power. Each interception using the David's Sling system costs around $700,000, and the Arrow 3, meant to intercept ballistic missiles in space, runs up to $4 million per launch. Even older Arrow 2 interceptors cost roughly $3 million.

Beyond security matters, "Israel's" offensive operations come with their own price tag. Keeping advanced F-35 jets in the air for long-distance missions, targeting Iranian territory over 1,600 km away, costs about $10,000 per hour per jet, according to security analyst Yehoshua Kalisky. The cost of fuel, precision bombs, and support operations only amplifies the daily burden.

"Per day it is much more expensive than the war in Gaza or with Hezbollah. And it all comes from the ammunition. That's the big expense," noted Zvi Eckstein of Reichman University. His institute estimates a one-month war with Iran would cost "Israel" approximately $12 billion.

Despite this massive outlay, analysts say "Israel's" economy remains vulnerable. Many sectors have been paralyzed by the Iranian response: the main airport was shut down, businesses shuttered, and only essential services permitted to function. Meanwhile, global credit rating agency S&P issued a warning, though it stopped short of revising "Israel's" credit outlook. Investors, for now, appear to be betting on a short war, an assumption that may prove misguided.

Illusion of invincibility

On the ground, Iranian precision strikes have shattered the illusion of Israeli invulnerability. Engineers and first responders describe destruction not seen in decades. "It would cost at least tens of millions of dollars to repair a single newly-built skyscraper in central Tel Aviv," said structural engineer Eyal Shalev.

More than 5,000 Israelis have been evacuated from missile-damaged neighborhoods and are now temporarily housed in state-funded hotels. Iranian targeting of critical infrastructure has been effective, including two strikes on "Israel's" largest oil refinery in the north, which forced a shutdown and left three settlers dead. Workers in key sectors have been instructed to remain at home amid growing instability.

Iran's response has not only shifted the military balance but also exposed the deep vulnerability of "Israel's" economy and civil infrastructure. With growing costs, damaged public morale, and uncertainty mounting, the war's continuation may prove more costly to Tel Aviv than it anticipated.