Kamal Ghorui
Asian markets opened the week on a weak footing, with investor sentiment weighed down by surging oil prices and escalating tensions in the ongoing US-Iran conflict. While Nikkei slid 5%, South Korea’s Kospi fell over 4%, though the indices later pared some of the losses.On Monday, Hong Kong’s Hang Seng Index fell 412 points or 1.65% to 24,539 as of 7:50 am IST. Shanghai and Shenzhen also traded in red, down 0.75% and 1.29%, respectively. In Japan, Nikkei was down 2,467 points or 4.6% to 50,905. South Korea’s Kospi also extended its fall, reaching 5,251 shedding 177 points or 3.5%.Meanwhile in commodity markets, oil extended its rally as the conflict entered its second month with no clear resolution in sight. West Texas Intermediate (WTI) climbed to $103.1, up $3.44 or 3.45%, after posting a 5.5% gain last week. Brent crude also surged past $110, reaching $116.4 per barrel, up $3.84 or 3.41%, building on gains of over 4% in the previous session. The strong momentum in oil prices comes against the backdrop of an escalating regional conflict. Iran has stepped up retaliatory strikes targeting Gulf states and the Strait of Hormuz shipping lane, a critical artery for global energy supplies. The widening hostilities have sent energy markets into a tailspin, fuelling fears for the broader world economy. Tensions heightened further after Iran’s parliamentary speaker, Mohammad Bagher Ghalibaf, accused the United States of planning a ground offensive, despite its public push for negotiations. His remarks followed the arrival of a US warship carrying around 3,500 military personnel to the region. The developments come after more than a month of aerial bombardments of Iran by US and Israeli forces. The situation has grown more complex with Yemen’s Iran-aligned Houthis entering the fray, launching their first attacks on Israel since the conflict began, adding another layer of uncertainty to an already volatile region. On the diplomatic front, Pakistan said it is preparing to host “meaningful talks” in the coming days aimed at resolving the conflict. This comes even as Tehran earlier accused Washington of gearing up for a land assault. Meanwhile, The Financial Times reported that US President Donald Trump said that the United States could seize Kharg Island in the Persian Gulf, a key hub for Iran’s oil exports, while also indicating that a ceasefire could come quickly.
