Import prices post sharpest rise in over 28 years in March amid Middle East crisis

Residents sit on a sofa in front of charred cars at the site of a building destroyed in an Israeli airstrike in central Beirut, Lebanon, April 14. AP-Yonhap

Import prices posted their sharpest increase in more than 28 years in March, driven mainly by rising global oil prices amid the Middle East conflict, central bank data showed Wednesday.

The import price index rose 16.1 percent on-month last month, accelerating sharply from a 1.5 percent increase in February, according to the preliminary data from the Bank of Korea (BOK).

It marked the steepest gain since January 1998, when prices jumped 17.8 percent. The figure also marked the ninth consecutive monthly increase since July 2025.

On an on-year basis, the index climbed 18.4 percent in March.

The increase came as the price of Dubai crude, South Korea's benchmark, soared 87.9 percent on-month to US$128.52 per barrel in March, as the Middle East conflict, which began late February following U.S.-Israeli strikes on Iran, disrupted global oil supplies.

South Korea relies heavily on energy imports.

"Import prices for crude oil surged 88.5 percent from a month earlier in won terms, marking the steepest increase on record," BOK official Lee Moon-hee said at a press briefing.

"Uncertainty remains high surrounding the Middle East situation. Even after the conflict ends, disruptions in raw material supply are unlikely to be fully resolved anytime soon," he added.

Also attributable was the weakening of the Korean won against the U.S. dollar amid the crisis in the Middle East, with the currency averaging 1,486.64 won per dollar in March, compared with 1,449.32 won a month earlier.

Prices of raw materials surged 40.2 percent, while intermediate goods rose 8.8 percent on-month in March.

Import prices are a key driver of inflation, as they affect production costs and consumer prices throughout the supply chain.

The data also showed that the export price index rose 16.3 percent from the previous month, the sharpest gain since January 1998, when it increased 23.2 percent.

Compared with a year earlier, the index jumped 28.7 percent.

"The increase in export prices was also driven by higher global oil prices, with petroleum product prices rising sharply," Lee said. "Gains in computers, and electronic and optical equipment, particularly semiconductors, also pushed up the export prices."