Key indices in Japan, South Korea, and Hong Kong fell sharply as Iran issued threats of attacks on energy infrastructure across the region.
Stock markets across the Asia-Pacific region declined sharply after U.S. President Donald Trump issued an ultimatum warning Iran to reopen the Strait of Hormuz or face the destruction of its energy infrastructure.
South Korea’s benchmark KOSPI fell 6.5% on Monday, while Japan’s Nikkei 225 dropped 3.5%.
In Hong Kong, the Hang Seng Index dropped more than 4%.
Australia’s ASX 200 ended the day 0.75% lower, while New Zealand’s NZX 50 slipped 0.7%.
In Europe, London’s FTSE 100 was down 1.4% in early trading, and Germany’s DAX 40 declined by around 2%.
On Wall Street, US equities also posted notable losses ahead of Monday’s opening. Futures linked to the S&P 500, traded outside regular hours, were down about 0.8% as of 07:00 GMT.
Oil prices remained volatile amid concerns over potential disruptions to global energy supplies.
Brent crude, the international benchmark, rose about 0.6% to $112.80 per barrel as of 07:00 GMT.
On Saturday, Donald Trump threatened to “obliterate” Iran’s power plants within 48 hours if Tehran did not lift its blockade of the Strait of Hormuz, a key route through which around one-fifth of global oil and gas exports pass.
In response, Tehran warned it could fully close the waterway—still used by a limited number of Chinese, Indian, and Pakistani-flagged ships—and carry out retaliatory strikes on energy and water infrastructure across the region if the threat is carried out.
Based on the timing of Donald Trump’s post on Truth Social, the deadline for his ultimatum is expected to expire at 23:44 GMT on Monday.
Donald Trump’s warning has intensified concerns over a potential global energy crisis, as the US and Israel’s conflict with Iran nears one month with no clear resolution in sight.
Oil prices have climbed more than 50% since the start of the conflict, which began with US–Israeli strikes on February 28.
Analysts warn that energy prices could rise sharply if the Strait of Hormuz remains effectively closed, with some predicting oil could reach $150 or even $200 per barrel.
Donald Trump spoke by phone on Sunday with UK Prime Minister Keir Starmer to discuss the situation in the Middle East, including the disruption of the strait.
According to Starmer’s office, both leaders agreed that reopening the waterway is “essential to ensure stability in the global energy market.”
Donald Trump has given mixed signals about the objectives of the conflict and how long it may continue.
Just hours before issuing his ultimatum on Saturday, he said his administration was “very close to meeting our objectives as we consider winding down” military operations against Iran.
Meanwhile, Israeli military spokesperson Nadav Shoshani said last week that officials had outlined plans for at least three more weeks of fighting.
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