TOKYO (AP) — Energy markets experienced dramatic volatility Friday as concerns about an extended Iran conflict drove crude oil costs sharply higher, while Asian financial markets showed mixed performance during cautious trading sessions. Many regional exchanges remained shuttered for Good Friday observances.
U.S. benchmark crude oil climbed 11.4% to reach $111.54 per barrel, while Brent crude, which serves as the global pricing standard, soared 7.8% to $109.03 per barrel.
According to BMI, a division of Fitch Solutions, “A more extended conflict raises the threat to physical infrastructure, extends disruptions through the Strait of Hormuz, and will entail a longer post-war recovery period, with price impacts spilling over later into the year.”
While the United States imports only a small percentage of its oil from the Persian Gulf region, petroleum operates as a global commodity with worldwide pricing mechanisms affecting all markets.
Asian nations face significantly different exposure to Middle Eastern supply disruptions. Japan depends heavily on oil shipments passing through the Strait of Hormuz to meet its energy requirements and would be forced to seek alternate shipping lanes during any closure. However, market observers suggest Japan and neighboring countries expect to negotiate transportation agreements with Iran to maintain access.
Tokyo’s Nikkei 225 index advanced 0.9% during Friday morning sessions to close at 52,938.62. South Korea’s Kospi surged 2.1% to reach 5,344.41, while China’s Shanghai Composite declined 0.5% to 3,899.57. Markets in Hong Kong, Singapore, Australia, New Zealand, the Philippines, Indonesia and India remained closed for the holiday.
U.S. markets, which were shuttered Friday, completed their first positive week since the Iran conflict began, despite opening Thursday with losses triggered by surging energy costs.
The market turbulence followed President Donald Trump’s Wednesday evening declaration that American military operations against Iran would continue, without providing a definitive timeline for concluding Middle Eastern hostilities.
The S&P 500 increased 7.37 points, or 0.1%, to finish at 6,582.69. Multiple days of strong performance this week allowed the benchmark index to post a 3.4% weekly gain. The Dow Jones Industrial Average dropped 61.07 points, or 0.1%, to close at 46,504.67. The Nasdaq composite advanced 38.23 points, or 0.2%, to end at 21,879.18. Both indices also recorded weekly increases.
Government bond yields held relatively stable in fixed-income markets. The benchmark 10-year Treasury yield decreased to 4.30% from the previous 4.32%.
Currency markets saw the U.S. dollar strengthen slightly to 159.66 Japanese yen from 159.53 yen. The euro traded at $1.1535, dropping marginally from $1.1537.
