Asian markets opened Friday on a cautious note, with a sharp swing in oil prices keeping risk appetite fragile, reminding traders how quickly Middle East headlines can ripple through global markets. However, a slight easing of panic around crude prices helped major indices in Japan and Australia climb higher amid thin holiday volumes.
Brent crude briefly surged to a four-year high above $126 a barrel on Thursday after reports that the US military would brief President Donald Trump on possible action against Iran. By Friday, Brent was holding near $111.60 a barrel, and US crude was around $105.50, signaling that the market was still volatile but no longer in panic mode.
The bigger issue for traders is not just the level of oil, but the speed of the move. That kind of whipsaw matters because it quickly feeds into inflation expectations, transport costs, and the outlook for central banks across import-dependent Asia. The Strait of Hormuz remains closed, Trump is due for more briefings on military options, and Iran is warning of retaliation if attacks resume.
The regional tone was mixed, not outright risk-on. Japan’s Nikkei 225 gained 0.7% to 59,687.65, and Australia’s S&P/ASX 200 rose 1% to 8,750.40, helped by a softer sense of panic around oil and a supportive lead from US corporate earnings, including strong results from Alphabet, Caterpillar and Apple. MSCI’s broad Asia-Pacific index outside Japan edged 0.3% higher. Meanwhile, Hong Kong’s Hang Seng index ended down 1.28%, and South Korea’s KOSPI fell 1.38%.
Trump’s meeting with Chevron and other energy leaders says a lot about how Washington is handling the Iran shock. The talks covered US oil production, futures, shipping, and natural gas, with the White House focused on what it would take to keep pressure on Tehran while limiting the damage to American consumers. Officials also pointed to tools already in play, including a Jones Act waiver, Strategic Petroleum Reserve loans, and looser refinery rules.
The overall sentiment in Asian markets is being driven less by domestic data and more by geopolitics, crude prices, and global earnings momentum. With many bourses closed for May Day, Friday's action is a thin-holiday rally, helped by earnings and a brief pause in the worst of the energy panic.
