Brent Crude Surges Towards $100 a Barrel Amid Middle East Tensions
The price of Brent crude has reached the cusp of $100 a barrel for the first time since late July, fueled by fresh fighting in the Middle East and concerns about a broader regional war.
This development is keeping a lid on risk appetite across Asian equity markets, although some stocks are bucking this trend. The yen is defying gravity, pushing towards seven-month highs against the dollar despite higher oil prices typically weighing on the currency due to Japan's reliance on imported energy.
The geopolitical backdrop is only getting darker, with Iran targeting a U.S. base in Jordan and Iranian-backed Houthis striking several Saudi cities. A move back above $100 a barrel for Brent crude would be a psychological blow to markets that have been agonizing over global inflation risks this year.
In other market news, the AI trade showed some cracks with a sharp correction in July, but some exuberance has returned of late. The is up over 4% today, helping lift South Korea's by more than 2%. Japanese cable makers and vaulted higher after a multi-billion-dollar deal between Verizon and Corning reignited excitement about data centre plays.