Asian markets plunged as oil prices soared above US$100 a barrel, triggering sharp sell-offs in South Korea and Japan amid heightened supply fears.
TOKYO: Asian stock markets plunged sharply on Monday as oil prices surged above US$100 (RM394.35) per barrel for the first time in nearly four years.
South Korea’s Kospi index plummeted 6.7% while Japan’s Nikkei 225 fell around 5.8% in early trading.
The spike was driven by a dramatic surge in crude oil benchmarks. West Texas Intermediate (WTI) was trading at USD 106.80 per barrel, up 17.4%.
Brent Crude rose 15.65% to US$107.20 per barrel.
Both benchmarks reached levels not seen since the early months of Russia’s 2022 invasion of Ukraine.
The price shock followed a near-total halt of maritime traffic through the Strait of Hormuz since the conflict began on February 28. Approximately 20% of global crude and gas passes through this critical chokepoint.
US President Donald Trump dismissed the price spike as a temporary necessity. “Short term oil prices, which will drop rapidly when the destruction of the Iran nuclear threat is over, is a very small price to pay for U.S.A., and World, Safety and Peace,” he wrote on social media.
“ONLY FOOLS WOULD THINK DIFFERENTLY!” he argued.
The soaring costs pose a significant threat to major Asian economies heavily reliant on Middle Eastern oil. Japan, the world’s fifth-largest crude importer, sources about 95% of its oil from the region.
Around 70% of Japan’s imports previously transited the Strait of Hormuz before the conflict.
Prime Minister Sanae Takaichi stated on March 2 that Japan holds emergency oil reserves equivalent to 254 days of domestic consumption. Kyodo News reported on Friday that the government was considering releasing some of these reserves.
South Korea, the world’s fourth-largest crude importer, also faced severe market pressure from the price surge. China remains the world’s biggest importer of crude oil.
