Asian Shares Slide as Oil Prices Surge and Central Banks Meet

Tensions in the Middle East and calls for a slowdown in artificial intelligence (AI) development weighed on Asian shares on Tuesday, as investors also digested rising oil prices and higher bond yields ahead of key central bank meetings.

The Yemen's Iran-aligned Houthis launched a new attack on Saudi Arabia on Monday, following Riyadh's accusations that Iran-backed fighters in Iraq were responsible for an attack on the kingdom's east-west pipeline, which could disrupt up to 4% of global oil supply.

The renewed supply concerns kept markets on edge, with US crude rising 1.27% to $102.68 a barrel and Brent increasing 1.21% to $106.96 per barrel.

Mitsubishi UFJ Bank analyst Yokoo Akihiko noted that 'markets are likely to remain focused on the risk that higher crude oil prices could add to inflationary pressures and, in turn, push interest rates higher.'