Asian Markets Slip as Oil Eases Amid US-Iran Tensions in Strait of Hormuz

Stocks across Asia declined on Tuesday while oil prices pulled back from the previous session’s surge, as renewed tensions between the United States and Iran kept investors on edge. The fragile situation around the Strait of Hormuz continued to weigh on global sentiment, with traders closely watching developments in the region.

Oil prices remained elevated despite the dip, reflecting ongoing concerns about supply disruptions. Brent crude fell 1.3 percent to $112.93 a barrel, while West Texas Intermediate crude dropped 2.3 percent to around $104. Both benchmarks had climbed sharply a day earlier following reports of heightened hostilities in the Gulf.

The latest market moves came after the United States and Iran exchanged fresh attacks on Monday, intensifying their struggle over control of the strategic shipping route. The situation unfolded shortly after Donald Trump announced efforts to assist vessels stranded near the chokepoint, a key artery for global energy trade.

Shipping giant Maersk confirmed that one of its US-flagged vessels had safely exited the Gulf under military escort, highlighting the risks facing commercial shipping in the region.

Equity markets reflected the uncertainty. MSCI Asia-Pacific ex-Japan Index fell 0.6 percent in light trading, with markets in Japan and South Korea closed for holidays. Hong Kong’s Hang Seng Index dropped more than 1 percent, while China’s CSI 300 Index showed little movement.

European futures also pointed lower, with contracts linked to the EURO STOXX 50, FTSE 100, and DAX all trading in negative territory.

Market analysts said the renewed conflict has shaken earlier optimism. Tony Sycamore of IG noted that hopes for a stabilizing effort in the region quickly faded as tensions escalated, leaving the situation uncertain.

Investors are also monitoring currency movements, particularly the Japanese yen. The currency briefly strengthened in the previous session, raising speculation that authorities in Tokyo may intervene again to support it. Satsuki Katayama warned against excessive currency speculation, keeping traders alert.

Meanwhile, attention is turning to upcoming corporate earnings and economic data in the United States. Companies such as Advanced Micro Devices and Pfizer are set to report results, while labor market figures later in the week could influence policy expectations at the Federal Reserve.

Safe-haven demand supported the US dollar, while gold edged higher, with gold rising 0.3 percent. Despite the pullback in oil, the broader market outlook remains tied to geopolitical developments, as investors assess the risk of further escalation in the Gulf.