Asian markets were largely down in early trading Tuesday as oil prices surged to nearly six-month highs after the U.S. said it would soon impose sanctions on all buyers of Iranian oil.

Japan’s Nikkei

NIK, -0.04%

  was off 0.2%, while Hong Kong’s Hang Seng Index

HSI, -0.08%

  was down about 0.1%. The Shanghai Composite

SHCOMP, -0.35%

  slipped 0.8% and the smaller-cap Shenzhen Composite

399106, -0.87%

  dropped 1.4%. South Korea’s Kospi

SEU, +0.07%

  was about flat, and benchmark indexes in Taiwan

Y9999, +0.13%

  and Singapore

STI, -0.07%

  pulled back slightly. Australia’s S&P/ASX 200

XJO, +0.74%

  gained 0.8%.

Among individual stocks, Rakuten

4755, -4.25%

 , Fast Retailing

9983, -2.73%

  and Nintendo

7974, -3.03%

  slumped in Tokyo trading, while oil producer Inpex

1605, +3.11%

  jumped. In Hong Kong, CNOOC

0883, +1.76%

  and China Life Insurance

2628, +2.74%

  gained while real estate companies such as Country Garden

2007, -3.71%

  and China Overseas Land & Investment

0688, -2.43%

  declined. Hyundai Motor

005380, +1.87%

 rose in South Korea, while Foxconn

2354, +0.14%

  slipped in Taiwan. Energy companies such as Beach Energy

BPT, +2.80%

  and Woodside Petroleum

WPL, +2.33%

  advanced in Australia.

There was no strong impetus for buying in Asia. Reports from a recent high-level meeting in China, which was chaired by President Xi Jinping, showed willingness to fine-tune monetary policy but raised questions about future government stimulus. Traders were waiting for a slew of U.S. earnings reports from big companies such as Twitter

TWTR, -0.03%

  starting Tuesday.

Over on Wall Street, the spike in crude oil prices boosted energy stocks on an otherwise listless Monday.

The broad S&P 500

SPX, +0.10%

  was up 0.1% at 2,907.97 while the Dow Jones Industrial Average

DJIA, -0.18%

  fell 0.2% to 26,511.05. The Nasdaq composite

COMP, +0.22%

  picked up 0.2% to 8,015.27.

On Monday, the Trump administration said it would no longer exempt any countries from U.S. sanctions if they continue to buy Iranian oil. The administration had granted eight waivers when it reimposed sanctions on Iran in November. These expire May 2.

Asian countries, namely China, India, Japan and South Korea are major importers of Iranian oil. The move will choke off more than $50 billion of annual Iranian income, which the U.S. says funds destabilizing activity in the Middle East and beyond.

“The prompt contracts quickly repriced higher on panic fears that markets could face an immediate supply crunch, adding more pressure to the already tenuous global supply squeeze,” Stephen Innes of SPI Asset Management said in a commentary.

Industry experts said the sanctions could potentially remove up to 1.2 million barrels of oil per day from international markets. But that number will likely be lower, depending on how countries respond and just how much oil Iran continues to export.

Oil prices rose for the third straight day on the news. Benchmark U.S. crude

CLK9, +2.59%

  added 34 cents to $65.89 per barrel in electronic trading on the New York Mercantile Exchange. The contract surged $1.48 to $65.55 per barrel on Monday. Brent crude

CLM9, +0.46%

 , used to price international oils, gained 29 cents to $74.33 per barrel in London. It jumped $2.07 to $74.04 per barrel in the previous session.

The dollar

JPYUSD, +0.097472%

  weakened to 111.80 yen from 111.93 yen late Monday.

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2019-04-22