Yemeni Drones Are Draining the Pentagon’s Budget by Millions of Dollars

NYN | Reports and Analyses 

Statements made by Acting Chief of U.S. Naval Operations, James Kilby, to Business Insider on Tuesday revealed the growing challenges facing the U.S. Navy in the Middle East due to the unexpected and extensive use of expensive air defense systems against low-cost threats—particularly since the escalation of attacks originating from Yemen.

Kilby said that since October 2023, the U.S. Navy has been forced to launch massive quantities of air defense interceptor missiles in response to hundreds of drone and missile attacks, the majority of which have come from Yemen.

He pointed out that the high rate of munitions consumption—especially SM-3 missiles, which cost between $10 million and $30 million each—has far exceeded the Navy’s projections and even the capacity of the U.S. defense industrial base.

Business Insider described the “Red Sea battle” as the clearest example of this imbalance, where the U.S. Navy found itself compelled to use multi-million-dollar missiles to intercept drones that cost only a fraction of that amount. This mismatch has imposed a new strategic reality on U.S. military operations.

The Navy leadership confirmed that since that battle, it has been seeking more cost-effective defensive options that can protect fleets without depleting expensive stockpiles—especially amid growing pressure on military supply chains.

According to the report, narrowing the gap between the cost of defense and the cost of the threat has become a top operational priority for the U.S. Navy, as the Red Sea turns into a financial and military drain that can no longer be ignored.