High Fuel Prices Were Contagious In April, Pushing Up All Kinds Of Costs

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High gasoline prices due to the Iran war don't just hit you at the pump: the extra fuel costs are pushing up prices for everything from airfare to eggs.

Tuesday's report on April inflation from the Bureau of Labor Statistics showed a widely expected surge in fuel costs and a higher-than-expected jump in "core" prices, which exclude the volatile prices for food and energy.

Accelerating inflation is one of the economy's biggest stumbling blocks and could prevent the Federal Reserve from cutting interest rates anytime soon.

Economists saw red flags that the price hikes are having a ripple effect on many other prices for everyday purchases. Here's what they are saying:

Jake Krimmel, senior economist at Realtor.com:

"Airline fares rose 2.8% on the month, and apparel and household furnishings both increased, pointing to early signs that the energy shock is bleeding through into core prices via fuel costs and Strait-related supply chain disruptions ... What started as an energy story is beginning to turn into something broader, something that we've been calling inflation contagion."

Kurt Rankin, senior economist at PNC:

"The spike in fuel prices resulting from the U.S. and Israel’s conflict with Iran has already begun to bleed through to non-energy consumer categories. As fuel is necessary to move goods to market, and energy in general is necessary to run operations, it is always only a matter of time until Core CPI inflation reacts to shocks like the current oil price spike."

"Consumers ultimately pay higher prices as producers and retailers pass on their own higher costs to their customers. That process is already underway, according to the April 2026 Core CPI numbers."

David Royal, chief financial and investment officer at Thrivent:

"Grocery prices, which had actually declined last month, spiked 0.7% in April—likely reflecting increased transportation costs as a result of higher oil prices. The increase was driven almost entirely by meat, eggs, fruits and vegetables."

Preston Caldwell, chief U.S. economist at Morningstar:

"Energy is a major input into food production and transportation. Hence, rising oil prices are starting to flow through into inflation beyond the direct impact of consumer purchases of gasoline, but also via non-energy goods for which oil is an input. Another example is airline fares, which jumped 2.8% in April.

Scott Anderson, chief U.S. economist at BMO Capital Markets:

"The unfavorable and larger-than-expected jump in core prices shows pressures are now spreading beyond energy, transportation, and food, into larger categories such as services and housing. If the energy price shock doesn’t subside soon, we can expect more of the same in the months ahead."

Katherine Judge, senior economist at CIBC:"This data only includes the first signs of broader spillover from the oil price shock into core components, and annual inflation is set to move higher in May."

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