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BoE, ECB Freeze Rates Amid Oil-Driven Inflation Surge

5/1/2026

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Summary

Story summary

Bank of England kept its policy rate at 3.75% while Brent crude rose above $120 a barrel.
Eurozone inflation climbed to 3.0% in April, driven by a 10.9% jump in energy costs.
European Central Bank left its key rate unchanged at 2% on Thursday, citing oil-driven inflation.
BoE Governor Andrew Bailey warned that oil above $130 could push inflation to 6%.

History

Historical Context

October 1973 OPEC, led by Saudi Arabia, imposed an oil embargo that lifted crude from about $3 to $12 per barrel by 1974, a four-fold jump. The shock forced Britain’s Bank of England to raise its base rate to 12% and inflation to 25% that year; today the BoE holds 3.75% and the ECB 2% as oil trades above $120 a barrel.

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Story summary

Bank of England kept its policy rate at 3.75% while Brent crude rose above $120 a barrel.
Eurozone inflation climbed to 3.0% in April, driven by a 10.9% jump in energy costs.
European Central Bank left its key rate unchanged at 2% on Thursday, citing oil-driven inflation.
BoE Governor Andrew Bailey warned that oil above $130 could push inflation to 6%.

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