Iran war pushes energy inflation to 25-year high: UBS

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The US-Iran war triggered the largest surge in global energy price inflation in nearly 25 years during March, driven by a sharp jump in oil and gas prices due to the closure of the Strait of Hormuz.

Arend Kapteyn, head of economic and strategic research at UBS, said the bank tracks inflation data in about 45 advanced and emerging economies, representing more than 85% of global GDP.

He added that the average monthly increase in energy prices reached 5.5% in the 27 countries that have released data so far, surpassing levels seen after the outbreak of the Russian-Ukrainian war in 2012, according to MarketWatch.

Kapteyn explained that two-thirds of the countries that have released data recorded monthly energy price increases that are among the highest on record compared to their usual rates, reflecting widening inflationary pressures globally, with limited exceptions such as Sweden, which benefited from milder weather that mitigated the rise.