In March 2026, monthly energy inflation in Latin America and the Caribbean increased significantly, from 0.19% in February to 1.42% in March, the highest value recorded in the past twelve months. This increase was linked to the impact of the conflict in the Middle East on international oil and petroleum product prices, in a context where the Strait of Hormuz—a key route for global energy trade—became a focal point of renewed tensions, pushing crude oil prices up to USD 116 per barrel. Although the region’s energy and electricity mix is highly renewable, it still maintains a significant dependence on fossil fuels, making it vulnerable to external shocks and volatility in international energy markets.
The rise in fuel prices had a direct effect on overall inflation, which increased from 0.38% to 0.75% between February and March, as well as on transport, logistics, and food prices. On average, gasoline prices rose by 15% and diesel by 21% across the region, although the impact was not uniform across countries due to the heterogeneity of policy measures implemented to contain the pass-through of international price increases to consumers, including subsidies, tax reductions, stabilization funds, and partial price containment schemes.
