President Donald Trump rejected Iran's counterproposal to end hostilities, calling it "garbage," as the month-old ceasefire teeters on collapse and Pentagon officials revealed the conflict has already cost American taxpayers $29 billion—$4 billion more than estimated just two weeks ago.
Trump said Monday that the ceasefire with Iran was on "massive life support" and "unbelievably weak" after he rejected Iran's counterproposal. He described Iran's latest counterproposal as "a piece of garbage," "totally unacceptable" and "stupid." Sources familiar with White House discussions said a major decision on how to proceed was unlikely to be made before Trump's departure to China on Tuesday afternoon, with Defense Secretary Pete Hegseth confirming the US military is prepared to restart operations against Iran if ordered to do so.
Escalating Fiscal Burden
The US war against Iran has cost $29 billion so far, according to Jay Hurst, who is performing the duties of Pentagon Comptroller. Hurst said Tuesday during a House Appropriations Committee hearing that the estimate was higher than the $25 billion figure senior Pentagon officials provided to Congress two weeks ago. He said the increase reflects "updated repair and replacement of equipment costs, and also just general operational costs to keep people in theater." Hurst later said at a Senate Appropriations Subcommittee hearing that the $29 billion figure does not include the costs of damages to US bases in the Middle East. "We just don't have a good estimate at this time," Hurst said.
Asked if he could provide a more formal accounting of the cost of the war with Iran with Congress, Defense Secretary Pete Hegseth said the Pentagon would "share what we can … when it's relevant and required." Democratic Rep. Pete Aguilar responded, "I think this would be the format that it would be required."
Energy Markets Under Pressure
The US Department of Energy announced the release of 53.3 million barrels of oil from the Strategic Petroleum Reserve on Monday to loan energy firms, part of a global effort to stabilize oil prices following the US-Israeli war with Iran. The latest release is part of a larger US commitment to add 172 million barrels to the global market. That pledge, announced in March as part of an International Energy Agency initiative involving more than 30 countries, aimed to add approximately 400 million barrels of oil to the global market.
Iran's closure of the Strait of Hormuz, a vital waterway which carried 20% of the world's oil and natural gas supply prior to the conflict, has raised oil prices and caused inflationary pressure across the global economy. Crude prices are up around 45%, or some $30 a barrel, since the war started. To date, approximately 35 million barrels have been delivered to the market from the Strategic Petroleum Reserve, according to the energy department. The reserve has been maintained by the federal government since 1975 to help protect the US economy from major disruptions in petroleum supply.
While some producers, including Saudi Arabia and the United Arab Emirates, have found alternative routes for their exports, around 10-12 million barrels of crude remain choked off from global markets per day, according to analysts. World oil consumption was around 103 million barrels per day last year based on preliminary estimates from the US Energy Information Administration.
Regional Security Threats Persist
Kuwait said it arrested four members of Iran's Islamic Revolutionary Guards Corps who were attempting to infiltrate the Gulf Arab country to "carry out hostile acts," according to state-run Kuwait's News Agency. The four attempted to enter the country on May 1 aboard a fishing boat and clashed with Kuwaiti soldiers, which led to the injury of one soldier, KUNA said. Kuwait's interior ministry said the four confessed about being tasked by the IRGC to infiltrate Bubiyan Island on May 1 "to execute the mission which includes conducting hostile acts against Kuwait."
Kuwait's Ministry of Foreign Affairs said it summoned the Iranian ambassador to hand him a protest note expressing Kuwait's outrage over the incident. Kuwaiti Deputy Foreign Minister Hamad Sulaiman Al-Mashaan told the Iranian ambassador that "Kuwait reserves its full right to defend itself" and "to take whatever measures it deems appropriate to protect its sovereignty and the security of its people and residents on its territory."
Diplomatic Maneuvering Ahead of China Trip
Trump said Tuesday he is confident Iran will stop enriching uranium and abandon any effort to build a nuclear weapon. In an interview on WABC's "Sid and Friends in the Morning," he said, "100% they're going to stop." He said, "I deal with them," and added, "And they said that we're going to get the dust. I call it the nuclear dust because it's appropriate. And we're going to get it." He also said, "We're not going to rush anything, we have a blockade."
Defense Secretary Pete Hegseth told lawmakers Tuesday that he will be with Trump on the trip to China. Asked about the status of weapons sales to Taiwan, Hegseth said, "The president's on the cusp of a trip and I'll be with him, and he will make all decisions related to that." Trump is expected to leave Washington for Beijing Tuesday afternoon.
Iran's ambassador to China, Rahmani Fazli, said Beijing "can be an important force for reducing tensions between Tehran and Washington, but mediation should not become a tool for managing pressure against Iran." He said China is "not merely an economic partner" but part of Tehran's "political balancing" against external threats. According to Fazli, Iranian Foreign Minister Abbas Araghchi's visit to China came as Iran actively tries to reshape its diplomatic position after the recent conflict with the United States and Israel, rather than simply reacting militarily or tactically.
On the eve of Trump's trip to Beijing, the US Treasury Department blacklisted 12 people and entities for their roles enabling the "sale and shipment of Iranian oil" to China.
Why This Matters:
The rapidly escalating cost of the Iran conflict—now $29 billion and climbing—underscores the fiscal burden of military engagement in the Middle East at a time when domestic priorities demand resources. The 45% spike in crude oil prices since the war started threatens to fuel inflation across the American economy, hitting consumers at the pump and raising costs throughout supply chains. Iran's continued aggression, evidenced by the attempted infiltration of Kuwait just 11 days ago, demonstrates that the month-old ceasefire has failed to contain Tehran's regional destabilization efforts. The drawdown of the Strategic Petroleum Reserve—a critical national security asset maintained since 1975—to manage oil price shocks raises questions about America's preparedness for future energy disruptions. As Trump heads to Beijing, the administration faces a strategic decision: whether to resume military operations or pursue diplomatic channels through China, with American taxpayers, energy consumers, and regional allies all bearing the consequences of Iran's intransigence.