Talks among members of the OPEC cartel and allied oil producing countries have broken off in the midst of a standoff with the United Arab Emirates over production levels.
Japan’s benchmark Nikkei 225 edged up 0.5% to 28,733.83. South Korea’s Kospi added 0.6% to 3,311.51. Australia’s S&P/ASX 200 inched up less than 0.1% to 7,318.30. Hong Kong’s Hang Seng lost 0.5% to 28,001.52, while the Shanghai Composite slipped 0.5% to 3,518.55.
In energy trading, U.S. benchmark crude rose $1.56 to $76.72 a barrel. Brent crude, the international standard, added 40 cents to $77.56 per barrel.
“Higher energy costs could fan inflationary stresses and add to the case for global central banks to temper emergency stimulus in the months ahead,” Harpreet Bhal of ActivTrades said in a commentary.
With oil prices pushing toward $80 a barrel, that “raises the risk of a price war if the conflict escalates, like in March last year,” Bhal said.
In Asia, the pandemic remains a major risk that could hinder the recovery in some countries with fresh outbreaks of COVID-19, said Yeap Jun Rong, a market strategist at IG in Singapore.
“This comes as the vaccination rate in Asia has been largely trailing behind other regions, leading to lockdowns being the go-to option to contain virus spreads,” Yeap said in a report.
Worries about health risks are growing ahead of the Tokyo Olympics, which begin later this month with 11,000 Olympic athletes and 4,400 Paralympians entering Japan from more than 200 countries. Tens of thousands of judges, sponsors, dignitaries and media also are attending.