The financial cost of the ongoing Iran conflict for the United States could eventually exceed $1 trillion, according to a leading public policy expert.

The Pentagon said on Tuesday that the current direct cost of the war has risen to $29 billion, up from an earlier estimate of $25 billion provided to Congress two weeks ago.

Officials said the revised figure includes updated operational expenses as well as the cost of replacing and repairing military equipment.

However, policy analyst at Harvard Kennedy School, Linda Bilmes believes the long-term financial burden will be far greater.

Bilmes estimates the total cost to American taxpayers could reach at least $1 trillion once future military repairs, weapons replacement and healthcare costs for veterans are included.

She said short-term expenses include missiles, bombs, aircraft carrier operations, combat pay and the replacement of destroyed military assets such as drones and fighter jets.

Bilmes also noted that replacing modern weapons systems often costs significantly more than their listed inventory value.

The conflict is also affecting the wider economy through higher energy prices.

The US Department of Energy expects oil prices to remain above $100 per barrel in the coming weeks, while some analysts warn petrol prices in the United States could rise to $5 per gallon.