Asia-Pacific Markets Tumble as Middle East Conflict Drives Oil Prices Above $100

Asia-Pacific stock markets fell sharply on Friday as investors reacted to soaring oil prices and growing fears that a prolonged conflict in the Middle East could disrupt global energy supplies and trigger a wider economic slowdown. The renewed tension in the region pushed international oil benchmarks above the $100 mark, unsettling markets across Asia and raising concerns about the impact on global growth.

The uncertainty intensified after Iran’s new Supreme Leader, Mojtaba Khamenei, suggested in a late Thursday speech that the Strait of Hormuz, a crucial pathway for global oil trade, should remain closed. He also warned that Tehran could open additional fronts in the ongoing conflict if tensions persist. Meanwhile, Alireza Tangsiri, commander of the Iranian Revolutionary Guard Corps Navy, reinforced the threat on social media, promising severe retaliation against adversaries.

Energy markets reacted immediately. International benchmark Brent Crude surged more than 9% to settle at $100.46 per barrel on Thursday, marking its first close above $100 since August 2022. U.S. West Texas Intermediate futures also jumped nearly 10% to $95.73. Analysts say oil prices may remain elevated as traders factor in the possibility of supply disruptions in the Gulf region.

The spike in energy prices triggered broad declines across Asian markets. Japan’s Nikkei 225 dropped 1.16%, while the broader Topix fell 0.57%. South Korea’s Kospi slid 1.7%, although the smaller Kosdaq posted a modest gain. Hong Kong’s Hang Seng Index declined about 1%, while mainland China’s CSI 300 slipped 0.39%. Australia’s S&P/ASX 200 also edged lower.

Market volatility was not limited to Asia. In the United States, major indexes closed at their lowest levels of 2026 during the previous session, with the Dow Jones Industrial Average dropping nearly 740 points. Investors are now closely watching upcoming inflation data while assessing geopolitical risks and the possibility of a recession. On prediction market Kalshi, traders raised the odds of a U.S. recession this year to 32%, reflecting growing anxiety in global financial markets.

source: cnbc