Asian currencies and stocks tumble as Iran war drives oil toward $115

Monday 30 March 2026 - 11:20

By: Dakir Madiha

Asian currencies and stocks tumble as Iran war drives oil toward $115

Asian currencies and equity markets came under heavy selling pressure on Monday as the U.S. and Israeli military campaign against Iran, now entering its fifth week, continued to push oil prices higher and deepen risk aversion across the region.

South Korea's Kospi plunged 4.73 percent at the open in Seoul, falling to 5,181.80, while the Korean won weakened to 1,513.4 per dollar, extending its slide to levels not seen in 17 years. Spot Brent crude hovered around $115 per barrel, up nearly 60 percent since the conflict began on February 28.

The won broke below the 1,500-per-dollar threshold that it had already crossed earlier in March, with the decline accelerating as import costs rise for an economy that sources roughly 70 percent of its crude oil from the Middle East. The Philippine peso fell to a record low of 60.55 pesos against the dollar on Friday, facing additional strain after President Ferdinand Marcos Jr. declared a national energy emergency. The Malaysian ringgit, Indonesian rupiah, and Thai baht have all weakened in recent weeks. Analysts at MUFG warned that the won, rupiah, peso, and baht are the currencies most exposed to energy import costs.

The U.S. dollar has emerged as the preferred safe haven during the crisis, gaining roughly 2 percent since the start of the war. Harvard economist Kenneth Rogoff told the New York Times that absorbing an oil price shock while exchange rates are already weak represents a compounding burden for Asian economies.

Weekend developments added to market anxiety. Houthi rebels in Yemen launched their first missile strikes against Israel since the conflict began, firing several salvoes at targets in southern Israel on Saturday. Israel confirmed intercepting at least one missile, and its military spokesperson said forces had prepared for the Houthis to enter the war.

The Washington Post reported Saturday that the Pentagon is preparing for several weeks of limited ground operations inside Iran, potentially including raids on Kharg Island, a strategic oil export hub, and coastal areas near the Strait of Hormuz. White House spokesperson Karoline Leavitt said the preparations give the president maximum options but do not indicate a decision has been made. Iranian parliament speaker Mohammad Bagher Ghalibaf warned that Iranian forces are ready to meet U.S. troops on the ground.

The combination of surging energy prices and weakening currencies is forcing central banks into difficult trade-offs. BMI, a division of Fitch Solutions, estimated that the conflict could add between seven and 27 basis points to consumer inflation across Asia, with the sharpest effects in Thailand, South Korea, and Singapore. Analysts at IndraStra Global warned that a prolonged conflict could trigger stagflation and delay any recovery in foreign capital flows. The Asian Development Bank cautioned that smaller energy-importing economies, including the Philippines, Pakistan, and Sri Lanka, face the greatest macroeconomic exposure, as rising oil prices feed rapidly into inflation and currency pressures.