Governments scramble to limit fallout of Iran war as oil prices surge

Record surge in oil prices after key producers cut output amid a widening Iran war has forced Asian governments to scramble to limit economic and consumer impact. Tehran signalling that hardliners will remain increases geopolitical risk, likely fueling higher inflationary pressure and risk-off flows across emerging Asian markets. Policymakers face potential supply-chain disruptions and elevated energy costs for consumers and industry.

Analysis

Record surge in oil prices after key producers cut output amid a widening Iran war has forced Asian governments to scramble to limit economic and consumer impact. Tehran signalling that hardliners will remain increases geopolitical risk, likely fueling higher inflationary pressure and risk-off flows across emerging Asian markets. Policymakers face potential supply-chain disruptions and elevated energy costs for consumers and industry.