South Korea's Central Bank Projects Further Inflation Rise in May Due to High Oil Prices

SEOUL, May 6 -- South Korea's central bank projected that inflation will rise further in May, attributed to high oil prices resulting from ongoing tensions in the Middle East. Yoo added that recent stability in food prices and government measures to stabilize prices are expected to reduce upward pressure from the oil price changes.

Government data released earlier on May 6 showed consumer prices in South Korea increased 2.6 percent in April from a year earlier. This marked the quickest year-on-year rise since July 2024, primarily due to a 21.9 percent jump in petroleum product prices, the highest in nearly four years.

Diesel prices rose 30.8 percent and gasoline prices increased 21.1 percent compared to the previous year, representing the largest gains since July 2022.

Yoo stated that significant uncertainty surrounds the future inflation outlook, including developments in the Middle East, oil price trends and effects on non-oil items. The central bank plans to monitor inflation closely. Global oil prices have increased sharply following the effective closure of the Strait of Hormuz since U.S.-Israeli strikes on Iran in late February 2026, which disrupted supplies.

South Korea depends heavily on imported energy. As of May 2, the average gasoline price in South Korea stood at 2,008.6 won per liter, according to Korea National Oil Corp. data.