New data from the US Bureau of Labor Statistics showed that inflation rose in March thanks in part to rising energy costs stemming from President Donald Trump’s war with Iran.
According to per BLS, the Consumer Price Index (CPI) posted a monthly increase of 0.9% in March, led by a 10.9% increase in energy prices including a massive 21.2% increase in gasoline.
On an annual basis, overall prices rose 3.3% from March 2025 – the highest annual rate of inflation since April 2024.
Meanwhile, the top Democrat on the US Senate Finance Committee revealed Thursday that a Treasury Department adviser admitted he was unaware the agency was doing any work to prepare for the economic fallout of Trump’s war, which has plunged the global economy into chaos and costing American drivers billions at the pump.
What was the Treasury doing?
Sriprakash Kothari, a senior adviser to Treasury Secretary Scott Bessent and Trump’s nominee to serve as assistant Treasury secretary for economic policy, told the staff of U.S. Sen. Ron Wyden (D-Ore.) behind closed doors that “not only did he not do any work related to energy markets, but he knew he was at war.” Wyden wrote in one paper to Bessent.
Wyden quotes Kothari as saying that he did no work to prepare for the economic impacts of the war “leading up to the conflict,” only starting work on it “after” it began on February 28.
“When later asked to clarify that answer, he reiterated that he had not done any analysis or work on energy markets, or any other economic aspect, in terms of military action in Iran,” Wyden added. “He further told staff that the work he then carried out occurred after he learned of the February 2026 attacks in the news. Mr. Kothari was then asked if he was aware of anyone at Treasury conducting analysis or work related to energy markets in advance of potential military action in Iran, to which he responded that he was not aware of anyone conducting such work.”
Wyden wrote that given the “rapidly growing affordability crisis” in the US — a crisis intensified by Trump’s war on Iran — “it is unacceptable that the Treasury may not have done the most basic planning before embarking.”
“Any problems resulting from the conflict we’re seeing now,” Wyden wrote, “were not only predictable, but predicted by intelligence agencies, which reported as recently as last March that Iran was ‘capable of inflicting severe damage on an attacker’ and ‘disrupting transportation, especially energy supplies, through the Strait of Hormuz.’
In just six weeks, Trump’s war in Iran has cost American taxpayers over $30 billion and countingand American drivers spent collectively over $8 billion more for gas during the first month of the illegal attack, which sent oil rising prices.
CNN reported last month since The Trump administration “significantly underestimated Iran’s willingness to close the Strait of Hormuz in response to the US military strikes during the planning of the ongoing operation.”
“While top officials from the Energy and Treasury departments were present at some of the official planning meetings about the operation before it began,” CNN reported, citing unnamed sources familiar with the discussions, “the agency’s analysis and projections that would have been integral elements of the decision-making process in past administrations were secondary considerations.”
Comments on inflation
University of Michigan economist Justin Wolfers commented in one social media post that inflation in March was “significantly up, and there will be more,” while describing the data as “the first numbers showing the economic effects of the war in Iran.”
New York Times economics reporter Ben Casselman observed that the 3.3% increase in inflation was “the fastest rate of inflation in Trump’s second term” and that “the jump was driven almost entirely by higher energy prices, a direct result of the war with Iran.” Heather Long, chief economist at Navy Federal Credit Union, noted a particularly troubling aspect of the BLS report, which has grown almost as fast as that “increase” is now.
“Wage growth was +3.5% in March for the last 12 months. Inflation was +3.3% in March for the last 12 months,” Long is explained. “This is the squeeze that many families are feeling. Their wages will not be able to keep up with this level of inflation. (And yes, it was the same situation in 2022).
Elizabeth Pancotti, managing director of policy and advocacy at Basic cooperation, said that the rise in inflation “is not a shock to anyone who has filled up their gas tank in the past month” and predicted that the damage would not be limited to fuel prices.
“Trump’s war spending on Iran will not stop at the pump,” Pancotti said. “Price hikes on summer vacations, groceries and electronics are falling as his war wreaks havoc on supply chains around the world. By pursuing this illegal war, the president has made it clear that he is putting American families first.”
of The Republican Party tried to play up the numbers by boasting that core inflation, which excludes food and energy prices, did not rise as much as expected.
“Core inflation has just come in LOWER than expected for the month of March!” THE GOP has written in a post on social networks. “President Trump continues to defy ‘experts’ and defy expectations.”
However, the GOP’s post drew some angry responses from followers who argued that core inflation matters little when energy prices are rising and gas prices are. the average $4.15 per gallon.
As Vox senior editor Benji Sarlin pointed out, that of former President Joe Biden The White House regularly highlighted core inflation figures as it tried to ease voter anxiety about rising prices, but with little success.
“Congratulations to all the people in the Trump White House who explain the difference between headline inflation and core inflation over a oil shock today, I’m sure the Biden WH alums will be very sympathetic,” Sarlin has written. “People on social media also love it when you say inflation is actually pretty good if you just exclude gas, try it.”
