The Middle East conflict may push inflation as high as the mid-6s by the middle of the year, economists warn, as businesses beyond the local petrol station start to slug consumers with higher prices from groceries to airfares.
The war in the Middle East has effectively shut the Strait of Hormuz, through which one-fifth of global oil supply passes. As a result of the disruption to supply, the price of Brent crude – the global benchmark price for oil – has risen from pre-war levels of around $US70 a barrel to above $US100 a barrel.
