Thai shares dropped sharply on Monday, in line with other markets in Asia, as the United States and Iran traded escalating threats and Israel planned for “weeks” more fighting, sending oil prices on another roller-coaster ride.
The Stock Exchange of Thailand index was down 25.57 points, or 1.78%, to 1,407.42 around 40 minutes after the open. Delta Electronics Plc and Advanced Info Service Plc shares were among the big losers of popular stocks, with Delta shares down 3.35% and Advance stocks declining 2.89%. Other losers included Gulf Development Plc, Airports of Thailand Plc, and Cpall Plc.
Other share markets in Asia also slid after Iran said it would strike the energy and water systems of its Gulf neighbors if US President Donald Trump followed through with a threat to hit Iran’s electricity grid in 48 hours, extinguishing any hope of an early end to the war now in its fourth week. Trump warned that Iran had two days to fully open the vital Strait of Hormuz, which is effectively closed for most vessels with little prospect of naval protection for shipping.
Japan’s Nikkei fell 3.8%, bringing losses for March so far to over 13%. South Korea’s market shed 5.2%, making a 12% drop for the month. MSCI’s broadest index of Asia-Pacific shares outside Japan lost 2.5%, while Chinese blue chips dropped 1.9%.
Oil prices were again choppy, with Brent last up 0.4% at $112.62 a barrel, and 55% higher on the month so far. US crude gained 0.8% to $98.98. Near-term supplies have been aided by the US allowing Iranian and Russian oil to be sold from tankers, but the growing risk of longer-term shortages was lifting futures down the curve. September Brent, for instance, was up $1 at $92.90, suggesting high prices were here to stay.
Analysts warned the war could still go on for many weeks yet and see oil prices rise to $150 a barrel, and the steady destruction of energy infrastructure means it will take longer to get supply back to normal. The crisis is being described as worse than the two oil shocks of the 1970s, with surging costs for jet fuel, liquefied natural gas, bunker fuel, and fertilizers.