SEOUL, April 2 (AJP) — South Korea's consumer prices accelerated at their fastest pace in three months in March on surging oil prices in the first month of the Middle East conflict, as the crippling of a key shipping waterway for energy supplies followed U.S.-Israeli attacks on Iran in late February, government data showed Thursday.
The consumer price index for March rose 2.2 percent from a year earlier, the fastest since a 2.3 percent increase in December, driven by higher transportation and utility costs linked to a spike in fuel imports, according to the Ministry of Data and Statistics.
Oil prices have surged amid tensions around the Strait of Hormuz — a chokepoint for roughly one-fifth of global oil and LNG trade — exposing South Korea’s deep reliance on imported energy.
The Strait of Hormuz, through which a significant share of Middle East energy supplies passes, has remained effectively constrained since the outbreak of the conflict.
South Korea relies on the Gulf for about 71 percent of its crude imports, 20 percent of LNG and around 77 percent of naphtha used in a wide range of industrial production, from plastics to paints. The Korean won has visited the lows of 2009 crisis period against the U.S. dollar, adding to import price pressure.
Petroleum prices jumped 10.4 percent from February and 9.9 percent from a year earlier, the primary driver behind a 1.5 percent on-month and 2.7 percent on-year rise in industrial goods prices, contributing 0.9 percentage point to the headline inflation increase.
Transportation costs rose 4.3 percent from a year earlier, while utility charges, including electricity, gas and water, climbed 3.1 percent, reflecting the pass-through of higher global energy prices.
Among key items, gasoline prices surged 8 percent on year and diesel rose 17 percent. The government has imposed a temporary cap on gas-pump prices, helping to contain further rise.
Service prices rose 2.4 percent on year, with dining-out costs up 2.8 percent and personal services gaining 3.2 percent.
Agricultural, livestock and fishery products eased 1.9 percent on month and 0.6 percent from a year earlier, with fresh food prices falling 2.7 percent on month and 6.6 percent on year to cap broader inflation.
Core inflation, which excludes food and energy, rose 2.1 percent on-year, remaining relatively stable and suggesting limited demand-driven pressure. The livelihood price index rose 2.3 percent, accelerated from 1.8 percent.
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