Oil Rises, Asian Markets Divided as AI Boom Overshadows Middle East Tensions — Update

By Ronnie Harui and Kimberley Kao

Oil rose while Asian stock markets were mixed as investors navigated the optimism surrounding the artificial intelligence boom against the backdrop of rising tensions related to the Strait of Hormuz, a key waterway through which one-fifth of the world's oil is typically transported.

Front-month West Texas Intermediate crude oil futures rose 2.0% to $96.30 per barrel in Asian trade Monday while front-month Brent crude oil futures gained 2.1% to $107.58 a barrel, ICE data showed.

Meanwhile, electronic and chip stocks powered Japan, South Korea and Taiwan markets to record highs.

"Asia is not trading as one market," said Charu Chanana, chief investment strategist at Saxo.

"Japan, Korea and Taiwan are being rewarded for their AI and hardware leverage, which are driving the earnings momentum and strong global investor flows," Chanana said. Meanwhile, China and Hong Kong still face old questions around domestic demand, confidence and policy follow-through, she added.

The Nikkei Stock Average rose 1.4% to close above 60000 for the first time, Taiwan's Taiex closed up 1.8%, led by TSMC's gains, while South Korea's Kospi rose 2.2% as chip and robotics stocks advanced.

Elsewhere, Hong Kong's Hang Seng Index was recently 0.3% lower while China's Shanghai Composite Index was 0.2% higher. China's tech-heavy ChiNext Price Index fell 0.5%.

Both the S&P 500 and the tech-heavy Nasdaq indexes posted record closing highs Friday.

U.S. equities have "held firm, complicating the USD outlook and highlighting a potential regime shift: energy shocks now bite assets unevenly, with AI-led equities showing unusual resilience," two FX strategists at OCBC Group Research said in a research report.

"Investors are willing to look through geopolitics where there is a strong structural story, and right now that is North Asia's AI backbone," Saxo's Chanana said.

Tensions around the Strait of Hormuz remain persistent. President Trump scrapped a trip by U.S. envoys Steve Witkoff and Jared Kushner to Pakistan for talks with Iran.

Meanwhile, Iran's Islamic Revolutionary Guard Corps boarded two container ships near the Strait, the country's Tasnim news agency said on Sunday. The vessels, identified as MSC Francesca and Epaminondas, are anchored near the channel, according to Tasnim and ship-tracking data. The U.S. stopped an Iranian-flagged oil tanker last Friday, as Washington maintains its blockade of Iranian ports on the Strait.

Risks of further supply disruptions are escalating as President Trump said Sunday that Iran has about three days before the country's oil pipelines risk explosion from being clogged up. Shipments from Iranian ports have been halted during the U.S. blockade of the strait. This means Iran has to store its oil, but the country's storage capacity is limited.

"The energy markets remain on edge as the U.S. is enforcing a strict naval blockade to pressure Tehran," Commerzbank Research analysts said in a research report.

Brent crude oil's rise above $100 a barrel signals supply stress, said Priyanka Sachdeva, senior market analyst at Phillip Nova in a note. The geopolitical backdrop remains far from stable and flows through the strait remain restricted, the analyst said.

"The message to energy markets remains clear: global oil flows are vulnerable, and the global economy continues to pay the price," Sachdeva wrote.

Write to Ronnie Harui at ronnie.harui@wsj.com

(END) Dow Jones Newswires

April 27, 2026 03:29 ET (07:29 GMT)