The Bank of Korea forecast consumer prices will rise by about four percent in the first quarter of this year.
An official at the central bank said on Sunday since the global oil price has sharply increased more than expected inflation will exceed the BOK's forecast last month of 3.7 percent.
The estimate was based on the global oil price sitting at 87 US dollars per barrel on average but it has recently surpassed 90 dollars.
According to the central bank's inter-industry relation table a ten percent increase in crude oil or raw material prices would boost domestic consumer prices by 1.3-5 percent.
The BOK official added the slow stabilization of vegetable prices, the continuing cold snap across the country and the nationwide spread of foot-and-mouth disease have also worsened the situation.
Meanwhile, on a brighter note Korea's trade surplus hit a record high of 41.2 billion dollars in 2010.
On Sunday Korea Customs Service released the confirmed figure, which is a little bit less than the government's initial estimate of 41.7 billion dollars but still an all-time high.
Last year's export volume also posted its highest amount mainly due to strong performances by the semiconductor, shipbuilding and panel display industries.
And so a customs official says Korea is expected to climb up by two steps to become the world's seventh largest exporting country in 2010.
Choi Won-young, Arirang News.