As Trump declares inflation tamed, Iran conflict threatens new price pressures
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The conflict involving Iran threatens another price spike that could undermine the president's central case for lower interest rates.
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In this article USO XOM CVX Follow your favorite stocks CREATE FREE ACCOUNT Gas prices at a Sunoco gas station in Media, Pennsylvania, US, on Monday, March 2, 2026. Oil surged the most in four years as the first impacts of the war in the Middle East began to be felt, with a near halt to traffic through the Strait of Hormuz and disruption at a big refinery in Saudi Arabia underscoring the threat to supplies in one of the world's top producing regions. Photographer: Matthew Hatcher/Bloomberg via Getty Images Matthew Hatcher | Bloomberg | Getty Images Just as President Donald Trump has been insisting that inflation is on the run , the war involving Iran threatens another price spike that could undermine his central case for lower interest rates. Oil prices jumped overnight as markets reacted to the escalation in the region, following a joint U.S.-Israel strike . West Texas Intermediate futures rose more than 5% while Brent crude futures gained about 6%, both off their overnight highs but still sharply elevated. The increase in oil prices adds another layer to recent indicators that, while inflation is well off its highs of a few years ago, underlying price pressures remain. Historically, surges in energy costs have often preceded broader inflation increases. Generally speaking, "war has proven to be 'inflationary,' as it is associated with negative supply shocks," wrote Thierry Wizman, global FX and rates strategist at Macquarie Group. "Indeed, even before the new U.S.-Iran war, oil prices were higher on hoarding, and since hostilities began, prices are being pushed up by higher insurance premiums and forced re-routing of maritime shipping." There also have been signs outside of energy markets that inflation pressures may be firming. watch now VIDEO 9:27 09:27 Famed energy investor Mark Fisher's take on oil prices, Iran conflict Halftime Report January's producer price index , a measure of wholesale costs and a proxy for pipeline inflation, rose a stronger-than-expecte...
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