Inflation Jumps to Highest Level Seen Under Trump as Gas Prices Spike

The second inflation report since the outbreak of the Iran war has revealed that prices are soaring on the back of sharp increases in energy costs.

On Tuesday, the Bureau of Labor Statistics (BLS) revealed that the annual headline rate of inflation rose to 3.8 percent in April from 3.3 percent in March, reaching its fastest pace since May 2023 and the highest level across both of Trump’s terms in the White House. Consumer prices were up 0.6 percent on a monthly basis following March’s 0.9 percent increase.

The headline annual increase came in slightly ahead of analysts' expectations. Consensus forecasts had annual inflation accelerating to 3.7 percent, while the monthly rate was expected to slow to 0.6 percent.

And energy prices were once again behind the gains, according to the BLS, accounting for 40 percent of the monthly increase.

Global oil prices have risen significantly on the back of supply constraints triggered by the Iran war, causing the price of gas-and other downstream products-to soar. According to data from AAA, the cost for a gallon of regular unleaded gas was $4.50 on Tuesday, compared to $4.13 a month prior and up over 50 percent since the conflict began on February 28.

Meanwhile, annual core inflation-which strips out the food and energy categories-reached 2.8 percent in April, up from 2.6 percent in March, as prices rose 0.4 percent month-over month. This was broadly in line with the respective 2.7 percent and 0.3 percent analysts had forecast.

While inflation was inching closer to the Federal Reserve's two-percent target toward the end of 2025 and early this year, the war has since put considerable pressure on consumer price data.

The energy index rose 3.8 percent in April after jumping 10.9 percent in March, the BLS said, with gas prices up 5.4 percent and the fuel oil index registering a 5.8 percent increase. On an annual basis, energy prices are now 17.9 percent higher than last April, with fuel oil prices having risen 54 percent over the same period.

The administration has been working to address rising fuel costs. On Monday, Trump told CBS News he was in favor of temporarily suspending the 18-cents federal gas tax, as some lawmakers had urged. However, analysts told Newsweek that this-as well as other domestic measures under consideration-would have little material impact, and that only an end to the conflict could reverse the effects of the worst energy crisis since 2022.

This is a developing story. More to follow.

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This story was originally published May 12, 2026 at 8:41 AM.