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Asian Equities · Energy Supply · Middle East Conflict · Oil Prices
Oil prices surged over 3% for both West Texas Intermediate and Brent crude, while Asian equities plummeted, with Japan's Nikkei down 4.7%, South Korea's Kospi falling 4.1%, and Australia's S&P/ASX 200 losing 1.3%, as fears of a widening Middle East conflict intensified.
The conflict, now in its fifth week, escalated with reports from The Wall Street Journal, citing U.S. officials, that President Trump is considering a military operation to extract almost 1,000 pounds of uranium from Iran. Yemen's Houthi rebels claimed responsibility for a second attack on Israel within 24 hours, deepening their role in the widening war.
StoneX's senior market analyst Matt Simpson stated the conflict shows little sign of de-escalation, with tensions broadening across the region, including Iran-aligned militias attacking U.S.-linked assets and Houthi forces disrupting Red Sea shipping routes. West Texas Intermediate crude oil futures climbed 3.1% to $102.69 per barrel, and Brent crude oil futures rose 3.0% to $115.97 a barrel.
Financial markets are increasingly concerned that a lasting energy supply disruption will hurt industries such as agriculture and transportation. Commerzbank Research analysts identified a shift in market narrative from an inflation shock due to higher oil prices to damage to global growth and the labor market from a prolonged energy shock.
U.S. stock futures also declined, with eMini S&P 500 futures shedding 0.4%, eMini Nasdaq 100 off 0.5%, and eMini Dow down 0.5%.
