Oil Prices Surge Towards $100 as Middle East Tensions Escalate

Oil prices surged on Wednesday, pushing Brent crude towards $100 per barrel for the fourth straight session. The rise in oil prices contributed to a subdued mood in Asian stock markets, with Japan's Nikkei and Hong Kong's Hang Seng indices both declining by around 0.2% and 0.3%, respectively.

The yen strengthened against the dollar, reaching its highest level in nearly seven months as traders exited short positions in the Japanese currency amid expectations of faster interest rate hikes from the Bank of Japan. The euro also edged higher ahead of the European Central Bank's policy decision on Thursday, with markets widely expecting a hike due to inflationary pressures.

The escalation of tensions in the Middle East, including attacks by Iranian-backed Houthis in Yemen and US forces hitting multiple Iranian oil tankers, further contributed to the rise in oil prices. Brent crude futures rose $1.10 to $99.02 per barrel, while U.S. West Texas Intermediate crude was at $93.95 a barrel.