"Import Prices Soar 16.1% on 'Direct Impact of Middle East War'... Highest Increase in 28 Years"

In March, import prices surged by 16.1% compared to the previous month. The sharp rise in international oil prices, directly impacted by the Middle East war, led to the highest growth rate in import prices in 28 years and 2 months. The import price of crude oil, based on contract currency, soared by 83.8%. This is the highest rate since January 1974 (98.3%) during the 'first oil shock,' marking an exceptional increase.

With import prices having risen for nine consecutive months and showing an unusual surge in March, upward pressure on consumer prices is expected to be inevitable for the time being. For April as well, there is significant uncertainty in negotiations between the United States and Iran, and both international oil prices and the Korean won are experiencing sharp fluctuations. Experts suggest that whether the upward trend in import prices will continue needs to be closely monitored.

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According to the "Export and Import Price Index and Trade Index (preliminary) for March 2026" released by the Bank of Korea on April 15, the import price index based on the Korean won was 169.38 (2020=100) last month, up 16.1% from the previous month. This is the first time in 28 years and 2 months, since January 1998 (17.8%), that import prices have jumped by as much as 16.1%. Compared to the same month last year, the index rose by 18.4%. Import prices have continued their upward trend for nine consecutive months since July last year. This is the longest streak since the 12 consecutive months of increases from August 2007 to July 2008.

This increase was driven by the surge in international oil prices following the outbreak of the Middle East war, which began with the U.S. and Israeli airstrikes on Iran on February 28. The average monthly price of Dubai crude oil skyrocketed from $68.40 per barrel in February to $128.52 in March, an 87.9% rise compared to February. The average monthly won-dollar exchange rate also jumped by 2.6%, from 1,449.32 won in February to 1,486.64 won in March.

As international oil prices and the exchange rate rose, import prices soared, particularly for mining products, coal, and petroleum products. By usage, raw materials-centered on mining products such as crude oil-rose by 40.2% compared to the previous month. The import price of crude oil rose by 88.5% from the previous month, marking the highest figure since statistics began to be compiled in won in 1985. The increase in the contract currency-based import price of crude oil was 83.8%, the highest since January 1974 (98.3%) during the first oil shock, a 52-year and 2-month high.

Intermediate goods rose by 8.8%, led by coal and petroleum products and chemical products. Capital goods and consumer goods increased by 1.5% and 1.9% from the previous month, respectively. Even excluding the effect of the depreciation of the won, March import prices surged significantly. The contract currency-based import price index also rose by 13.6% from the previous month. Compared to the same month last year, it increased by 16.0%.

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With the unpredictable development of the Middle East war, it is impossible to forecast the direction of import prices for April. Moonhee Lee, team leader of the Price Statistics Team at the Economic Statistics Department 1 of the Bank of Korea, stated, "As of April 13, the average monthly price of Dubai crude oil had fallen by 14.8% compared to the previous month's average, but during the same period, the average won-dollar exchange rate rose by 1.0% from the previous month." He added, "Given the extremely high uncertainty regarding negotiations between the United States and Iran, and the fact that it will be difficult to fully resolve raw material supply disruptions in the near term, it is difficult to forecast the direction of import prices for April."

However, with import prices rising for nine consecutive months and showing an exceptional surge in March, upward pressure on consumer prices is expected to be unavoidable in the short term. Lee explained, "The sharp rise in international oil prices in March affected petroleum products such as gasoline, raising petroleum consumer prices by 10.4% from the previous month," and added, "The future trend of consumer prices will depend on the development of the Middle East war and the effectiveness of government measures to stabilize prices." He also noted that if the war is prolonged, the impact of high oil prices and raw material supply disruptions could spread throughout the economy, further increasing upward pressure on consumer prices, especially given that import prices have risen for nine consecutive months through March.

Last month, export prices rose by 16.3% from the previous month. This is the highest increase in 28 years and 2 months since January 1998, when export prices rose by 23.2%. Compared to the same month last year, export prices jumped by 28.7%. The rise was driven by increases in international oil prices and the exchange rate due to the Middle East war, as well as higher prices for coal and petroleum products and for computers, electronics, and optical devices. By item, industrial products-centered on coal and petroleum products as well as computers, electronics, and optical devices-rose by 16.3% from the previous month. Agricultural, forestry, and fishery products increased by 5.1% from the previous month. The contract currency-based export price index also surged by 13.6% from the previous month and rose by 25.9% from the same month last year.

The export volume index, which shows the changes in export and import volumes, rose by 23.0% compared to the same month last year. Lee explained, "Exports of computers, electronics, and optical devices, particularly semiconductors, continued to perform well, and until March, there were no significant supply disruptions for raw materials in chemical products, which contributed to these results." The export value index surged by 51.7%. During the same period, the import volume index rose by 12.3% due to increases in computers, electronics, optical devices, and chemical products. The import value index increased by 12.9%. The net barter terms of trade index and the income terms of trade index rose by 22.8% and 50.9%, respectively, compared to the same month last year.

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