Oil prices surpass $100, triggering a massive shakeup in Asian stocks! Japan and South Korea stock markets both plummeted, with KOSPI falling over 7%

On Monday morning in Asia, as international oil prices broke above $100 per barrel for the first time since 2022, Japan and South Korea stock markets led a sharp decline across Asia-Pacific markets. The inflationary pressure from soaring oil prices could push up living costs and central bank interest rates worldwide.

The Nikkei 225 index opened down 1.82%, and as of press time, the decline has widened to over 6%, marking the index’s first drop below 52,000 points since January 9. The Topix index also fell more than 5%.

In terms of heavyweight stocks, SoftBank Group dropped over 10%, and chip-related stocks Advantest and Lasertec both plummeted 11%.

South Korea’s KOSPI index opened down 5.7%, and as of press time, the decline has expanded to 7.7%.

Major stocks such as Samsung Electronics, SK Hynix, and Hyundai Motor all fell over 9%.

After a 5% drop in KOSPI 200 index futures, the Korea Exchange triggered the KOSPI index circuit breaker, pausing trading for 5 minutes.

Other stock markets also experienced significant declines. As of press time, Australia’s benchmark S&P/ASX 200 index fell over 4%, and the Hang Seng Index dropped 2.81%.

Meanwhile, influenced by rising oil prices, U.S. stock futures also declined sharply on Monday, indicating a potential plunge at the market open. As of press time, S&P 500 futures, Dow Jones Industrial Average futures, and Nasdaq 100 futures all fell over 2%.

Due to the ongoing closure of the Strait of Hormuz caused by the Iran conflict, and with more major Middle Eastern oil producers reducing output, international oil prices broke above $100 per barrel on Monday, the first time since the Russia-Ukraine conflict erupted in 2022. WTI crude futures surged over 20% at one point.

Latest weekend reports indicate that after Iraq, the UAE and Kuwait have also begun reducing oil production…

Because hostilities in the Middle East continue, oil tankers are still hesitant to risk crossing the Strait of Hormuz, and investors are preparing for a prolonged period of rising energy costs.

“Global economies still rely heavily on Middle Eastern oil and natural gas transported through the Strait of Hormuz,” said Bruce Kasman, Chief Economist at JPMorgan Chase. “The short-term scenario is oil prices soaring to $120 per barrel, then quickly falling as conflicts subside. But without clear and decisive political solutions, Brent crude is expected to stay around $80 per barrel into mid-year.”

Such a situation could reduce global economic growth by 0.6 percentage points in the first half of this year and increase the annual consumer price inflation by 1 percentage point. He warned that if the conflict expands and persists, oil prices could break above $120 per barrel, triggering a global recession.

However, U.S. President Donald Trump posted on his self-created social media platform Truth Social that the short-term rise in oil prices is “just a negligible cost for eliminating Iran’s nuclear threat.”

Currently, tensions between the U.S. and Iran show no signs of easing. According to CCTV News, on the 9th local time, Iran’s expert council confirmed Mujetaba Khamenei as the new Supreme Leader of Iran, the son of the late Supreme Leader Ali Khamenei.

According to Xinhua News Agency, Trump threatened on the 8th that Iran’s new leader, without his approval, would not last long. “He must be approved by us, or he won’t last long,” Trump said. He also mentioned that the possibility of deploying special forces to seize Iran’s enriched uranium has not been ruled out, and “all options are under consideration.”

(Source: Caixin Global)