Global markets remained under pressure on Wednesday as the conflict between the United States, Israel, and Iran continued to escalate, raising concerns over oil supply disruptions, inflation, and financial market stability.
Developments in the Middle East, including warnings from Iran’s Islamic Revolutionary Guard Corps (IRGC) over the Strait of Hormuz and fresh missile alerts in Israel, have intensified geopolitical uncertainty.
At the same time, Asian equities dropped sharply, cryptocurrency markets struggled to maintain recent gains, and OpenAI is reportedly exploring a significant expansion of its artificial intelligence deployment into NATO’s classified networks.
Middle East conflict escalates
Tensions in the Middle East escalated further after Iran’s Islamic Revolutionary Guard Corps claimed control of the Strait of Hormuz.
According to Iran’s Fars news agency, Mohammad Akbarzadeh, an IRGC navy official, said, “Currently, the Strait of Hormuz is under the complete control of the Islamic Republic’s Navy.”
He warned that ships passing through the key waterway could face missile attacks or stray drones.
The comments came after the United States Central Command (CENTCOM) said that no Iranian ships were currently operating in the strait.
The strait is one of the world’s most important oil transit routes, carrying roughly one-fifth of global oil consumption.
The conflict has widened geographically. Israel has sent troops into Lebanon, while Iran’s retaliatory attacks have struck Gulf oil refineries and US diplomatic facilities, including a drone strike on the US consulate in Dubai.
Washington has urged Americans to leave 14 countries in the region due to what it called “serious safety risks.”
US embassies in Beirut, Kuwait, and Saudi Arabia have also been closed.
Asian markets tumble amid oil shock fears
Financial markets across Asia fell sharply as investors reacted to the risk that the war could trigger a prolonged energy shock.
South Korea’s benchmark Kospi index plunged more than 11%, triggering a circuit breaker.
The index has lost 17% over two days, marking its steepest decline since 2009.
The Korean won simultaneously fell to a 17-year low.
Japan’s Nikkei dropped 3.5%, while Taiwan’s main equity index slid 4.3% as investors rapidly exited semiconductor stocks, one of the region’s strongest performers in recent months.
Brent crude climbed further, leaving prices up more than 17% for the week at about $83 per barrel.
However, prices retreated slightly after Trump announced an insurance guarantee for Gulf shipping and suggested that US naval escorts could accompany oil tankers through the Strait of Hormuz.
The selloff also reflected the vulnerability of energy-importing economies such as Japan, South Korea, and Taiwan, which are particularly exposed to rising oil prices.
Bitcoin struggles to hold gains
Cryptocurrency markets also reflected the broader uncertainty.
Bitcoin failed to sustain recent rallies above $70,000 and traded around $68,212 during Wednesday’s Asian session.
The cryptocurrency has now rejected the $70,000 level three times since the February 5 market crash.
Ether slipped 1.1% to $1,971, while BNB rose 6.8% over the week to $632.
Other tokens struggled, with Dogecoin falling 2.37% in 24 hours and Cardano dropping 3.54%.
The pattern suggests markets are waiting for greater clarity on geopolitical developments.
OpenAI explores expanding AI deployment across NATO networks
OpenAI is in advanced talks to deploy its artificial intelligence systems across the North Atlantic Treaty Organisation’s classified networks, reported The Information.
The potential agreement would expand the company’s national security partnerships beyond its recent contract allowing the Pentagon to deploy its models within classified US networks.
OpenAI previously said the US military “absolutely needs strong AI models” to address emerging threats but stressed that strict safeguards are necessary.
The company said it would not remove safety features to improve military performance and insisted that any classified deployment must include strict guardrails.
Its agreement with the US Department of War includes cloud-only deployment, legal and ethical restrictions on AI-directed weapons, compliance with US law, and embedded oversight from OpenAI engineers.
Chief executive Sam Altman told employees that the Defense Department ultimately decides how its technology is used.
“You do not get to make operational decisions,” Altman said during an internal meeting, said a Bloomberg report citing a person familiar with the discussion.
If finalized, the NATO deployment would represent one of the most significant integrations of advanced artificial intelligence systems into military and intelligence operations among allied nations.
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