Argentina’s inflation rate rose more than expected last month after an energy shock sparked by the Iran war, the latest sign of the conflict’s metastasizing economic impact.

Fuel prices in South America’s second-largest economy have jumped by almost a quarter since February, pushing up overall monthly inflation to 3.4% — above the 3% forecast by economists — which risks undoing some of the country’s progress against soaring prices.

However, Argentinian President Javier Milei has argued the country stands to gain from the war in the long term, as demand grows for its oil and agricultural exports, which he hopes will help build up Argentina’s depleted foreign currency reserves. Argentina “will see an improvement in its terms of trade,” Milei said last month.