Eurozone inflation soared in February to a record high of 5.8 per cent, mainly on the back of surging energy prices, the EU’s official statistics agency Eurostat said on Wednesday. 

The acceleration, from 5.1 per cent in January, was announced as oil and gas prices rocketed even higher over fears about the impact on supplies from Russia’s invasion of Ukraine.

Brent crude topped $110 a barrel for the first time since 2014 and WTI followed suit hours later to hit the highest level since 2013. European natural gas prices similarly hit a record level.

The surge in inflation comes at a difficult time for European leaders as they warn their citizens of the “price to pay” from tough sanctions imposed on Russia, the EU’s leading foreign gas supplier. Policymakers fear soaring inflation could choke off the EU’s recovery from the coronavirus pandemic.   

Eurostat said energy prices in February jumped 31.7 per cent, faster than the 28.8 per cent recorded in January. Food prices were up 4.1 per cent in February, compared with 3.5 per cent the previous month.

Analysts at Capital Economics predicted inflation would hit six per cent in the coming months before falling back to around four per cent, “most likely” at the end the year. That is still double the European Central Bank’s target of around two per cent.

Analysts at Capital Economics predicted inflation would hit six per cent in the coming months before falling back to around four per cent, “most likely” at the end the year

Capital Economics warned that not only energy prices, but also food prices could rise further due to the conflict in Ukraine, a major wheat exporter. 

The EU and Western allies have imposed sweeping sanctions on Moscow over President Vladimir Putin’s invasion. They have unleashed turmoil on Russia’s economy and forced the Kremlin to impose capital controls.