Asian markets mixed as Iran conflict enters seventh day

Friday 06 March 2026 - 09:50

Asian financial markets ended a volatile week with mixed results on Friday as oil prices eased slightly after days of sharp swings triggered by the escalating conflict involving Iran. The fighting, now in its seventh day, has disrupted global energy flows and unsettled investors across major asset classes.

The turmoil began after the United States and Israel launched joint military strikes against Iran on February 28. Since then, the conflict has effectively shut the Strait of Hormuz, a critical route for global oil shipments, intensifying concerns about supply disruptions and broader economic fallout.

Wall Street experienced a turbulent week as energy costs surged. On Thursday, the Dow Jones Industrial Average dropped nearly 785 points, or about 1.6 percent, putting the benchmark index on track for its worst weekly performance since October, according to CNBC. The S&P 500 fell 0.6 percent, moving back into negative territory for the year, while the Nasdaq Composite declined 0.3 percent. Earlier in the week, the Dow briefly plunged more than 1,200 points in a single trading session before recovering some of the losses.

Oil prices drove much of the market volatility. On Thursday, US crude climbed above $81 per barrel and Brent crude exceeded $85, reaching their highest levels since the summer of 2024, according to Reuters. Prices retreated slightly on Friday, however, with US crude falling about 1.2 percent and Brent declining roughly 1 percent. Analysts at ING said the pullback followed a US decision to grant a 30 day waiver allowing Indian refiners to continue purchasing Russian oil.

Trading across Asia reflected the uncertainty. Japan’s Nikkei 225 gained about 0.4 percent and Hong Kong’s Hang Seng index rose more than 1 percent. In contrast, Australia’s S&P/ASX 200 dropped more than 1 percent and South Korea’s Kospi fell about 1.3 percent, according to the Associated Press. Taiwan’s Taiex and India’s Sensex also ended the session lower.

The economic impact of the conflict is centered on the closure of the Strait of Hormuz, through which roughly one fifth of global seaborne oil passes. A senior official from Iran’s Revolutionary Guard declared the waterway closed on March 2 and warned that vessels attempting to cross it could be targeted. Several ships have reportedly been struck by drones and projectiles since the conflict began.

The disruption has raised fears of a broader energy crisis. JPMorgan estimated that around 329 oil tankers were stranded in the Gulf by midweek. Some analysts told NPR that oil prices could surpass $100 per barrel if the shutdown persists.

Despite the rising economic risks, there are few signs of de escalation. US President Donald Trump told Reuters that higher gasoline prices were not his main concern and that the military operation remained the priority.

At the same time, Israeli airstrikes have continued to hit targets in Tehran and Beirut, with Israeli officials warning that the campaign could intensify further.

The unpredictable trajectory of the conflict has left investors struggling to assess the outlook. Analysts say markets have not yet entered a panic phase, but as the confrontation stretches into another week, maintaining that calm is becoming increasingly difficult.