Asian stocks opened lower on Thursday, with the S&P/ASX 200 down 1.38%, Nikkei 225 lower 0.71% and KOSPI declining 0.50%. Rising oil prices and escalating tensions between the US and Iran kept investors cautious.
Brent crude edged closer to $102 a barrel, extending its advance for a fifth consecutive session after settling above the $100 mark for the first time since July. West Texas Intermediate traded around $97 a barrel.
The rise in crude followed a fresh escalation in the US-Iran conflict, with Tehran warning that it was prepared for a more intense confrontation. The developments have renewed concerns about potential disruptions to energy flows through the Strait of Hormuz.
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The increase in oil prices is also adding to inflation concerns, with investors looking ahead to two US inflation reports due this week. A sustained rise in energy costs could complicate the outlook for interest rates.
US equity futures were mixed early Thursday after Wall Street's major averages fell for a third straight session. Dow futures gained 54 points, or 0.1%, while S&P 500 futures rose 0.04%. Nasdaq-100 futures were marginally lower.
The previous session saw the Dow fall more than 400 points, or 0.8%, while the S&P 500 declined 0.5% and the Nasdaq Composite lost 0.6%.
The latest moves leave Asian investors weighing the impact of higher energy prices on inflation and monetary policy alongside the worsening geopolitical backdrop in the Middle East.
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