Weekly Economic Report 3.13.26

There is really not much point in discussing anything other than the closure of the Straits of Hormuz and the possible consequences. West Texas Intermediate crude oil was trading just over $66 on average in the week ahead of the US-Israel decapitation of Iran’s leadership. As we begin writing Friday morning, it is trading at $95 – a 44% premium. The simple math is to note that direct energy consumption accounts for 6.3% of the CPI – and was up 0.5% over the past twelve months ended mid-February 2026 when the survey was taken. Every sustained 10% premium would lift the CPI by 0.6%, so it is hardly a stretch to assume that next month’s seasonally adjusted increase in the CPI could have a 1-handle for the month, and boost the annual change by as much, since the rise in the March 2025 CPI was a muted 0.03% headline and 0.07% core. By the time of that release, we will be in the sixth week since the attack, with a much better idea of whether oil prices will be high through the summer. Our current assessment is that price hikes will be sticky.

EU03-13-2026.pdf

Download PDF • 122KB