US inflation climbs to 3-year peak amid West Asia oil shock, conflict

Consumer inflation in the United States climbed to a three-year high in April as the economic impact of the Iran conflict pushed energy costs sharply higher, according to government data released on Tuesday.

The US Consumer Price Index (CPI) rose 3.8% year-on-year in April, accelerating from 3.3% in March, data from the Bureau of Labor Statistics (BLS) showed, as reported by news agency AFP.

The surge comes amid escalating tensions in West Asia following the US-Israel conflict with Iran, which has disrupted global energy markets. Iranian retaliatory measures and restrictions around the Strait of Hormuz — a key global shipping route for oil and gas — have intensified concerns over supply disruptions and driven up fuel prices worldwide.

Nearly 20% of the world’s oil and natural gas trade passes through the Strait of Hormuz under normal conditions, making the region critical to global energy flows.

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Reflecting the impact of rising fuel costs, the US energy price index jumped 17.9% in April compared to a year earlier, marking the steepest increase among all major inflation categories. Food prices also continued to rise, increasing 3.2% year-on-year during the month.

Meanwhile, core inflation, which excludes volatile food and energy prices, edged up to 2.8% in April from 2.6% in March, indicating broader price pressures across the economy.

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US households have already been grappling with persistent inflationary pressures since the pandemic era, with policymakers facing challenges in restoring price stability. The Federal Reserve has maintained a long-term inflation target of 2%, but several central bank officials have recently signaled that further interest rate hikes may be required if inflation remains elevated.