A renewed oil price surge has raised concerns that US headline inflation could rebound sharply in July, after lower energy costs helped bring down the June Consumer Price Index. Economist Peter Schiff warned that Brent crude’s move back above $100 could undo much of the previous month’s inflation relief.

Schiff made the warning after oil prices recovered quickly from their June lows. In a post on X, he said oil had already risen 30% in July and had returned above $90 per barrel at the time of his comment.

“Investors celebrated the June CPI, as a 30% fall in the price of oil led to a larger-than-expected decline.”

Schiff Says July CPI Could Be Stronger

Schiff said that if oil reached $100 before the end of the month, it would mark a 43% gain from its lows. Brent moved through that level only hours later. Attacks on Saudi tankers added another risk for energy transportation in the Middle East.

Schiff’s warning focused mainly on headline inflation, which includes energy prices. Core CPI is a separate measure that excludes energy and food prices. That distinction matters because large moves in gasoline and other energy costs can change the headline monthly reading even when underlying categories are more stable.

Investors celebrated the June CPI, as a 30% fall in the price of oil led to a larger-than-expected decline. But so far in July, the price of oil is already up 30%, back above $90 per barrel. If the price hits $100 by month-end, that will be a 43% rise. July CPI could be a doozy! — Peter Schiff (@PeterSchiff) July 23, 2026

https://x.com/PeterSchiff/status/2080236734567105002

According to Bureau of Labor Statistics data, headline CPI fell 0.4% in June from May. Economists polled by Reuters had expected a 0.1% decline. Annual inflation eased to 3.5% from 4.2%, below the 3.8% forecast.

Energy prices accounted for much of the June relief. The energy index fell 5.7%, its largest monthly drop since April 2020. Gasoline prices declined 9.7%. Core CPI was flat on the month and rose 2.6% from the same period a year earlier.

Supply Concerns Push Brent Above $100

The oil price rebound followed supply concerns that shifted market conditions after June’s decline. On Thursday, Brent jumped about 7% to $100.71, its highest level in nearly two months. WTI also climbed above $90 for the first time since June.

According to a Reuters report, Iran has stopped exporting oil after the conflict reduced exports from 2 million barrels per day to nearly zero. Goldman Sachs said Brent could rise above $120 if the disruption continues. That projection depends on the scale and duration of the supply cuts.

Crude oil does not flow into CPI one-for-one, but it is a key input for retail fuel prices and broader energy costs. The timing and size of any CPI effect can depend on how quickly wholesale price changes reach consumers and whether elevated crude prices persist through the survey period.

The oil price surge has also affected expectations for the next Federal Reserve meeting. As of July 23, futures market participants still favored no rate change at the upcoming meeting. Market pricing showed a 64.2% probability that the Fed would keep the target range at 3.50% to 3.75%.

Fed Decision Will Come Before July CPI Data

Data from the CME FedWatch Tool showed a 35.8% probability of a quarter-point rate increase. That probability had risen sharply from 10% on July 14, after the release of June inflation data, which came in below expectations.

Policymakers will not have the July inflation data before making their rate decision. The Bureau of Labor Statistics has scheduled the July CPI report for August 12. As a result, Fed officials will meet without official CPI data showing how the July oil price increase affected consumer prices.

Schiff’s warning places energy prices at the center of the near-term inflation outlook. He said the oil price surge could undermine the decline in inflation recorded in June. The July CPI report will show whether higher crude prices translated into renewed upward pressure on consumer inflation.