Inflation Surges in May Due to Energy Costs Amid Iran Conflict

In May, inflation reached levels not observed in three years. This surge resulted mainly from increased energy costs linked to the ongoing conflict with Iran. According to the latest consumer price report from the Bureau of Labor Statistics, consumer costs rose by 4.2% compared to a year ago. This figure marks the largest 12-month rise since April 2023. Month-over-month data shows a slight cooling in inflation, with prices increasing by 0.5% in May, compared to 0.6% in April.

Impact of Soaring Energy Costs

Energy prices significantly fueled the recent inflation surge, with the energy index contributing over 60% to the monthly increase in all items. The war with Iran has primarily caused these high energy costs. Amid the conflict involving the U.S., Israel, and Gulf States, Iran has closed the Strait of Hormuz, a crucial route for a fifth of the world’s oil and gas shipments. In retaliation, the U.S. has blocked Iranian ports and fired on tankers in the region. This has severely restricted fuel flow.

Domestically, the impact is evident. Oil, diesel, and gas supplies remain tight, leading to rising costs. Gas prices nationwide have surpassed $4.50 per gallon, while electricity costs have returned to record highs. Rising expenses for food and shelter have also contributed to the overall inflation increase.

Tracking Everyday Costs

The Tribune monitors 11 everyday costs for Americans, including eggs, milk, bread, bananas, oranges, tomatoes, chicken, ground beef, gasoline, electricity, and natural gas. This tracker is updated monthly using consumer price index data from the U.S. Bureau of Labor Statistics.

Eggs

Eggs have become one of the more affordable grocery items. Prices have decreased each month since March 2025, following a bird flu outbreak disrupting the egg supply. Prices are now at their lowest since November 2023, with a dozen large Grade A eggs priced at $2.19.

Milk

Milk prices continue to rise, with a gallon of fortified whole milk reaching $4.22. This represents a near 5% increase since last year.

Bread

Bread prices dropped slightly, with $1.83 per pound of white bread, approximately 5% lower than when President Donald Trump began his second term.

Bananas

Banana prices remained steady at $0.65 per pound, consistently hovering between 65 and 67 cents over the past 12 months.

Oranges

Orange prices increased by 2.5%, typical for this time of year as they are cheapest in winter, bottoming in March or April. A pound of navel oranges costs $1.54.

Tomatoes

Tomato prices dropped 20 cents from April’s high, now at $2.49 per pound. High prices earlier were due to a 17% import tax on Mexican tomatoes.

Chicken

Chicken remains stable at $2.04 per pound. Prices have shown little fluctuation, with minor changes observed over the year.

Ground Beef

Despite a recent drop, ground beef costs remain high at $6.72 per pound, the result of low domestic production and strong demand. Price increases led by environmental factors and consumer preference have raised costs by 22% since the Trump administration began.

Electricity

Electric costs have surged to 20 cents per kilowatt-hour, marking a record high. The average monthly bill for Americans, excluding delivery charges and fees, is now approximately $176.

Gasoline

Gasoline prices continue to rise, with the national average reaching $4.65 per gallon. Chicago faced higher increases, dealing with prices above $5.00. Disruptions in the Middle East oil production have no immediate resolution.

Natural Gas

Natural gas costs remained stable despite broader energy price hikes. With increased production and storage, the U.S. has avoided the high prices seen in Europe, keeping current costs at $1.68 per therm.