Asia shares slip as oil jumps on Gulf attack fears

Asian shares slipped as fighting intensified in the Gulf and Iran closed the Strait of Hormuz, sending oil prices higher and reviving inflation worries that can quickly reach U.S. drivers, investors and retirement savers. Crude moved first, equities followed, and bond traders pushed yields firmer as markets reassessed the chances of easier Federal Reserve policy.

The Strait of Hormuz is the pressure point. An average of 20 million barrels a day of crude oil and oil products moved through the waterway in 2025, according to the International Energy Agency. Flows through the strait in 2024 and the first quarter of 2025 accounted for more than one-quarter of global seaborne oil trade and about one-fifth of worldwide oil and petroleum product consumption, according to the U.S. Energy Information Administration. At its narrowest point, the strait is just 29 nautical miles wide, with two-mile-wide navigable channels and a buffer zone.

When crude jumps on Gulf attack fears, gasoline futures follow, and the next stop is the pump. U.S. fuel costs can rise even if the physical flow of oil is not fully shut, because traders price in risk before supply actually disappears. Higher energy costs can then feed back into headline inflation expectations, which is why bond yields firmed and the dollar rose as investors moved away from the idea of a quick policy shift from the Federal Reserve.

Asian benchmark indexes fell as investors reassessed exposure to oil-sensitive sectors and to companies whose profits depend on stable shipping lanes, cheaper freight and predictable input costs. The same shock that pushes energy shares higher can weigh on airlines, transport names, consumer companies and rate-sensitive stocks. For U.S. retirement accounts tied to broad index funds, the damage is not from oil alone but from higher crude, firmer yields and weaker risk appetite across the market.

Traders were also bracing for a heavy week of corporate earnings, including major U.S. banks and technology companies. Earlier in the week, renewed Middle East tensions had already pushed oil higher and pressured Asian shares and semiconductor stocks at times, even as technology strength briefly offset war fears on Wall Street.