Energy Prices and U.S. Inflation

CBS News reports that the Iran war’s effective closure of the Strait of Hormuz has driven Brent crude from about $70 a barrel before the Feb. 28 U.S.–Israeli strikes to $108.84, pushing average U.S. gasoline prices to $3.92 per gallon as of March 20—up 29 cents in a week and nearly $1 in a month, according to AAA. Economists Diane Swonk of KPMG and Bernard Yaros of Oxford Economics say the surge in oil and gas will sharply lift headline inflation in March and April, with the hit spreading beyond the pump into food and other goods as transport and energy costs rise. ShipMatrix data show fuel surcharges as a share of shipping fees have jumped 17% in three weeks, and logistics expert Satish Jindel warns low-margin retailers like Dollar Tree, Family Dollar, Marshalls and TJ Maxx may have to raise prices and online sellers may raise minimums for free shipping because they can’t absorb the added costs. East Coast grocer Stew Leonard’s says suppliers are already tacking on fuel surcharges but it is resisting price hikes as long as possible, underscoring an emerging squeeze on margins and potentially employment. The story highlights how a distant conflict and chokepoint disruption are beginning to filter directly into U.S. household budgets, echoing growing social-media concern that this round of war-driven inflation will hit everyday essentials and e-commerce convenience, not just gas stations.