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.
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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