Iran conflict pushes oil prices back above $100, Asian stock markets decline

Investing.com - Asian stocks retreated on Thursday after two days of gains, with oil prices soaring near $100 per barrel following the escalation of Middle East conflicts causing new supply disruptions.

As of 02:38 GMT, U.S. stock futures also declined during Asian trading hours.

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Oil prices surge near $100 per barrel; Nikkei drops 2%

Following reports of two international oil tankers being attacked in the northern Persian Gulf near Iraq and Kuwait, oil prices surged over 7% in early trading.

Iraqi media blamed Iran for the attacks, raising concerns that the conflict could further spread to key energy shipping routes.

The Nikkei 225 index in Japan fell 2%, while the broader Topix index declined 1.6%.

South Korea’s KOSPI dropped 1.1%, and Australia’s S&P/ASX 200 declined 1.7%.

Reports of further attacks on commercial ships passing through the Strait of Hormuz also pushed oil prices higher, as this strait is one of the world’s most critical oil transportation chokepoints.

Despite efforts by governments and global institutions to stabilize the markets, crude oil prices remain elevated. After surging close to $120 earlier this week, oil prices have now returned to around $100 per barrel.

Iran warned that if the conflict escalates further, the global market should prepare for oil prices to potentially reach $200 per barrel.

Rising oil prices intensify inflation concerns

Investors worry that sustained increases in oil prices will heighten inflation fears and complicate the outlook for central banks, which are already balancing efforts to control price pressures while supporting economic growth.

Investors are currently awaiting the release of the U.S. Personal Consumption Expenditures Price Index on Friday, the Federal Reserve’s preferred inflation gauge, to gain further insight into the future direction of U.S. monetary policy.

In other parts of Asia, China’s Shanghai Composite edged down 0.2%, while the CSI 300 index declined 0.6%. Hong Kong’s Hang Seng index fell 1.1%.

Singapore’s Straits Times Index dipped 0.3%, and futures linked to India’s Nifty 50 declined 0.7%.

This article was translated with the assistance of artificial intelligence. For more information, see our Terms of Use.