Petroleum 'Shock' from Middle East Conflict Drives April Inflation to 2.6%... Highest in 21 Months (Update)

Petroleum Products Soar 21.9%, Hitting a 3-Year, 9-Month High
Driving the Index with a 0.84 Percentage Point Contribution

The aftermath of the Middle East war has impacted domestic prices, pushing last month's consumer price inflation rate above the mid-2% range. As international oil prices soared, petroleum product prices posted a record increase, and service prices—such as dining out—also surged, further straining household finances.

Yonhap News

According to the "Consumer Price Trends for April 2026" released by the Ministry of Data and Statistics on May 6, last month’s Consumer Price Index (CPI) reached 119.37 (2020=100), up 2.6% compared to the same month last year. This marks the highest level in one year and nine months since July 2024, when it was also 2.6%. While inflation remained stable in the 2.0% range earlier this year, it climbed rapidly by 0.4 percentage points in just one month to 2.2% in March, then to 2.6% in April.

The sharpest increase was seen in petroleum products. Last month, petroleum product prices soared by 21.9% year-on-year, significantly contributing to overall inflation. This is the highest rate in three years and nine months since July 2022 (35.2%). As international oil prices surged due to instability in the Middle East, prices for diesel (30.8%) and gasoline (21.1%) both recorded double-digit increases. Petroleum products accounted for 0.84 percentage points of inflation, making up roughly one-third of the total increase in prices last month.

The oil price shock has spread across the transportation sector. Transportation prices rose by 9.7% year-on-year last month, marking the largest increase since July 2022 (15.4%). In addition to petroleum products, international airfare (15.9%) also rose, further limiting mobility for citizens.

Service prices also climbed by 2.4%, continuing their upward trend. Personal services, including insurance premiums (13.4%) and overseas group travel expenses (11.5%), rose by 3.2%. The price of dining out increased by 2.6%, further reinforcing price rigidity. Among manufactured goods (up 3.8%), not only petroleum products affected by oil prices but also computers (19.4%) and sporting goods (15.4%) saw significant increases.

On the other hand, agricultural, livestock, and fisheries products fell by 0.5% year-on-year, thanks to increased supply, serving as a "shield" that prevented a further spike in overall prices. Fresh vegetables such as cabbage (-27.3%), onion (-32.0%), and radish (-43.0%) dropped sharply by 12.7%, showing signs of stabilization. Processed foods, supported by government price stability policies and cooperation from the industry, rose by only 1.0%, indicating a slowdown in price increases.

The core inflation rate, based on the OECD standard (excluding food and energy), remained at 2.2% year-on-year, the same as the previous month. The index excluding agricultural and petroleum products rose by 2.3%. However, the Living Price Index, which reflects perceived inflation, increased by 2.9%, 0.3 percentage points higher than the overall index, indicating that the burden of high prices has become even more severe for ordinary citizens.

This content was produced with the assistance of AI translation services.