The U.S.-Iran conflict continued to underpin concerns over oil supply disruptions in Asian trade Wednesday. That lifted crude prices and pressured the Japanese yen, which is near its weakest levels against the dollar in about four decades.
American forces successfully completed the 11th straight evening of strikes against Iran, the U.S. Central Command said in a post on social-media platform X. The forces "targeted military operations centers, maritime capabilities, aircraft hangars, drone storage facilities, and military logistics infrastructure to further degrade Iran's ability to threaten commercial shipping in the Strait of Hormuz," Central Command added. The Strait is a critical waterway through which one-fifth of the world's oil is transported.
A threat by Yemen's Houthi militants to blockade Saudi Arabia has started to take shape, while Ukrainian attacks on Russia's Black Sea shipping have disrupted operations of a key pipeline there. Two oil tankers loaded with Saudi crude oil turned around Tuesday. A successful blockade would open another front in the U.S.-Iran conflict and exacerbate supply disruptions caused by Iran's stranglehold on the Strait of Hormuz.
"Oil prices pushed up higher amid the ongoing concerns related to the Mid-East tensions," Maybank analysts said in a FX Research & Strategy report. "Risks are certainly there that if tensions keep persisting, oil can move back above the" $100.00 per barrel level, they added.
Front-month West Texas Intermediate crude oil futures gained 0.9% to $85.13 per barrel and front-month Brent crude oil futures advanced 1.1% to $91.99 a barrel, ICE data showed.
The dollar was supported as higher oil prices have "rekindled inflation concerns and reinforced expectations for a hawkish" Federal Reserve, strategists at OCBC Group Research said in a note.
The dollar rose above the psychologically-important 163 yen level on Tuesday for the first time since 1986, according to LSEG data, but inched 0.1% lower in Asian trade Wednesday to Y163.06.
"The move continues to be underpinned by wide [interest] rate differentials [between the U.S. and Japan] and has renewed speculation of potential currency intervention by Japanese authorities," OCBC's strategists added.
Japanese Finance Minister Satsuki Katayama on Wednesday repeated her recent comments that suggested authorities remain ready to step into the foreign-exchange market.
"We stand ready to take appropriate and decisive action at any time if necessary," Katayama said. "With the situation between the U.S. and Iran escalating so abruptly, this severe turn of events was neither expected nor anticipated anywhere in the world, making this a very difficult situation," she added.
Equity markets across Asia were mixed. South Korea's Kospi rose 1.4% and Singapore's FTSE Straits Times Index advanced 0.4%. Meanwhile, Hong Kong's Hang Seng Index fell 1.1% and Malaysia's FTSE Bursa Malaysia KLCI shed 0.3%. Japan's Nikkei Stock Average was flat, erasing an earlier gain of as much as 2.1%.
Write to Ronnie Harui at ronnie.harui@wsj.com
(END) Dow Jones Newswires
July 22, 2026 02:36 ET (06:36 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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