The Feb. 28 US‑Israel strikes aimed for shock‑and‑awe, but Iran’s missile and drone barrage turned the fight into a stalemate. Thousands died, mainly in Iran and Lebanon, while the closure of the Strait of Hormuz choked a key oil conduit. A cease‑fire extension reached Sunday, promising to reopen the waterway.

Iran redirected most of its retaliation toward Gulf neighbours, with the United Arab Emirates absorbing 45 % of strikes on military and civilian sites. Kuwait and Bahrain, hosts of major US bases, also suffered. Rystad Energy estimates $58bn needed to rebuild energy infrastructure damaged between late February and early April, underscoring a massive reconstruction bill.

The war drove U.S. gasoline to about $4 a gallon, spiking to $6 in California, and forced Asian importers to seek alternative supplies. Vietnam turned to US and Nigerian oil; the Philippines bought Russian crude for the first time in five years and imposed a four‑day workweek. With the World Bank trimming global growth forecasts, the conflict’s economic shock is now worldwide.

U.S. defense spending surged as the Pentagon reported $29 bn in war costs, with estimates ranging up to $34 bn for munitions and base repairs. Europe responded with fuel tax cuts; Germany earmarked €1.6 bn for diesel and petrol relief. The combined fiscal burdens highlight how a regional clash reshaped global energy markets and sovereign budgets.