U.S. Central Command confirmed that recent operations targeted military logistics, maritime capabilities, and drone storage facilities to protect commercial traffic in the Strait of Hormuz. With one-fifth of global oil supply traversing this chokepoint, market anxiety is mounting. Reports of Houthi militants threatening a blockade of Saudi Arabia, paired with Ukrainian disruptions to Russian pipeline operations, have forced oil tankers to divert, further tightening supply chains.

Analysts at Maybank warned that if these regional hostilities persist, crude could breach the $100 per barrel threshold. Current data shows West Texas Intermediate futures rising 0.9% to $85.13, while Brent crude climbed 1.1% to $91.99. These energy costs have reignited inflation fears, strengthening the dollar as investors anticipate a more aggressive stance from the Federal Reserve.

The yen remains under heavy pressure, trading near 163 against the dollar. While Japanese Finance Minister Satsuki Katayama reiterated that the government is prepared to take decisive action to curb currency volatility, the market remains skeptical. Asian equity markets reflected the uncertainty, showing mixed results as investors weigh the potential for a wider geopolitical conflict against the ongoing interest rate gap between the U.S. and Japan.