Asian shares fell on Tuesday as Ukraine peace talks made little headway and the prospect of a ban on oil imports from Russia triggered investor fears over inflation and slowing economic growth.
President Joe Biden’s administration is willing to move ahead with a US ban on Russian oil imports even if European allies do not, Reuters reported on Monday, citing two people familiar with the matter.
Oil prices have already hit 14-year highs and Russia warned that prices could surge to $300 a barrel and it might close the main gas pipeline to Germany if the West halts oil imports over the invasion of Ukraine.
MSCI’s broadest index of Asia-Pacific shares outside Japan lost 0.4 percent in early trade, tracking a bruising Wall Street session. Japan’s Nikkei sank 0.3 percent while Australian shares were down 0.24 percent amid a sea of red across Asian markets.
Chinese blue chips shed 0.15 percent while Hong Kong’s Hang Seng index rose 0.39 percent.
International oil benchmark Brent crude, which briefly hit more than $139 a barrel in the previous session, jumped around in morning trade and was up about 0.8 percent at $124.20.
US crude was up about 0.4 percent at $119.86 a barrel, while prices of many other commodities, including nickel, rose as industrial buyers and traders scramble as the Russian-Ukraine conflict shows no sign of cooling.
“Global risk sentiment started the week deeply negative, before improving as European leaders indicated they would resist sanctions on Russian energy exports, preferring instead a determined strategy to reduce dependency on Russian imports,” ANZ analysts said in a note.
