Soaring oil prices fuel inflation fears Jonathan Corpina, senior managing partner of Meridian Equity Partners, analyzes how news about Iran and OpenAI fueled market woes in “The Claman Countdown.”
Inflation has increased in April, as consumer prices rose due to the impact of the war in Iran on the energy market and the economy in general.
The Bureau of Labor Statistics said Tuesday that the consumer price index (CPI) — a broad measure of the cost of everyday goods like gas, groceries and rent — increased 0.6% from a month ago and is 3.8% higher than last year. This is the highest level since May 2023.
Expectations and reality The monthly rise of 0.6% was in line with the expectations of economists surveyed by LSEG, while the annual figure was above the forecast of 3.7%.
So-called underlying prices, which exclude volatile measures of gasoline and food products to better assess price growth trends, increased by 0.4% on a monthly basis and by 2.8% compared to last year. Both figures were higher than economists’ forecasts, by 0.3% and 2.7% respectively.
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Economists noted that inflation data from December 2025 to April 2026 will be affected by data collection interruptions that occurred during the 43-day government shutdown last fall.
During the shutdown, the BLS was unable to collect data and used a carryover methodology to compensate for the lack of October CPI reporting and missing data in the November report. Economists say this will likely cause inflation data to be biased downward until the spring, when new data will wipe out the discrepancy.
The distribution of the cost of livingHigh inflation has created serious financial pressures in recent years for most American households, who are forced to pay more for daily necessities like food and rent. Price hikes are particularly difficult for low-income Americans, as they tend to spend more of their already strained wages on necessities and have less flexibility to save.
Energy prices rose 3.8% in April amid disruption to Middle East oil supplies caused by the war in Iran, with prices up 17.9% last year. The BLS noted that the energy index accounted for more than 40% of the overall CPI increase in April.
Gasoline prices have increased significantly from last year due to the impact of the war in Iran. (Justin Sullivan/Getty Images)
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Gasoline prices rose 5.4% in April and 28.4% from a year ago. Electricity prices increased by 2.8% on a monthly basis and by 6.1% compared to last year. Gas utility prices decreased 0.1% in April and increased 3% last year.
Food prices rose 0.5% in April and 3.2% from a year ago. The Meals at Home Index increased by 0.7% on a monthly basis and is up 2.9% from last year. The index of meals consumed away from home increased by 0.2% in April and is 3.6% higher than a year ago.
Prices for meat, poultry and fish increased 1.2% on a monthly basis and 6.7% from a year ago. Beef and veal prices increased 2.7% in April and are 14.8% higher than a year ago. Egg prices rose 1.5% in April but are down 39.2% year-on-year as supplies normalized after an outbreak of bird flu created shortages. The fruit and vegetable index rose 1.8% in April and is 6.1% higher than a year ago.
Food prices increased in April and are up 3.2% from a year ago. (Justin Sullivan/Getty Images/Getty Images)
Housing prices were 0.6% higher in April and 3.3% higher than last year. Renters and household insurance costs increased 0.1% for the month, but are up 7.2% year over year.
Prices for transportation services increased 0.3% for the month and are 4.3% higher than a year ago. Air fares accounted for much of the increase, as they rose 2.8% in April and 20.7% year over year.
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What the experts sayJames McCann, senior economist for investment strategy at Edward Jones, said that “American households continue to feel the brunt of rising energy costs, adding to the deluge of inflation they have faced since the pandemic. Additionally, with the Strait of Hormuz still effectively closed, the risk that we are not past the peak of these price pressures increases. »
“The good news is that the economy so far appears resilient to this price shock. Many consumers have received tax refunds this year, hiring has picked up from near-stagnant rates in 2025, and companies are generating solid profit growth,” McCann added.
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Seema Shah, chief global strategist at Principal Asset Management, said the inflation data likely pushed the Federal Reserve to cut rates until December at the earliest, with growing risks that it might not happen until 2027.
“While the pick-up in headline inflation was expected, the upside surprise in core inflation is more substantial. It tentatively hints at broader price pressures, which the Fed will be reluctant to dismiss,” Shah said. “It is still too early to conclude that lasting runoff momentum is underway. But with inflation rising to its highest level since 2023 and looking uncomfortably sticky, alongside a more resilient and dynamic labor market, the case for prudent policy has strengthened.”
