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Nazrin Abdul

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Major stock markets across Asia tumbled on Monday as escalating threats between United States and Iran deepened investor concerns, with the ongoing conflict now entering its fourth week, AzerNEWS reports, citing foreign media.

Japan’s benchmark Nikkei 225 dropped nearly 3.6%, while South Korea’s Kospi plunged close to 6%, reflecting heightened vulnerability among energy-importing economies.

Tensions intensified after Donald Trump warned that Washington could “obliterate” Iranian power plants if Tehran fails to reopen the critical Strait of Hormuz -a key global oil transit chokepoint. In response, Iran signaled it would target strategic infrastructure across the region, including energy facilities, in the event of an attack.

The situation has had a disproportionate impact on countries such as Japan and South Korea, both of which rely heavily on oil and gas shipments passing through the Strait. Since late February, Iran has effectively restricted access to the waterway, through which around 20% of global oil and liquefied natural gas (LNG) flows.

The disruption has already driven global fuel prices higher and intensified concerns over supply shortages. International Energy Agency Executive Director Fatih Birol warned that the world could be heading toward its most severe energy crisis in decades. Speaking in Australia, he compared the current situation to the oil shocks of the 1970s and the fallout from Russia's invasion of Ukraine.

“This crisis, as it stands, is now two oil crises and one gas shock combined,” Birol noted, underlining the scale of the disruption.

Meanwhile, the conflict has continued to escalate militarily. Iranian missile strikes targeted Israeli cities, including Dimona and Arad, prompting further threats from Tehran. Mohammad Bagher Ghalibaf warned that any attack on Iran’s power plants would trigger irreversible damage to regional energy and desalination infrastructure.

Broader Asia-Pacific markets also declined, with Hang Seng Index falling nearly 3.5% and China’s Shanghai Composite Index down 2.5%.

Despite the geopolitical turmoil, oil prices showed relative stability on Monday. Brent Crude rose 0.45% to $112.69 per barrel, while WTI Crude increased by 0.7% to $98.93.