Oil prices rose on Wednesday on fears conflict in the Middle East could turn into a wider war and disrupt oil supply from the key producing region after Iran fired ballistic missiles at Israel.
The dollar held its sharpest gain in a week on Wednesday after an Iranian missile attack on Israel drove buying of safe assets as investors fretted about the widening of conflict in the Middle East.
Asian stocks pulled back from two-and-half-year highs on Tuesday and the dollar firmed following comments from Federal Reserve Chair Jerome Powell that scuppered bets of big interest rate cuts, while Middle-East tension kept risk sentiment in check.
Oil prices were little changed on Tuesday as stronger supply prospects and tepid global demand growth outweighed worries that escalating tensions in the Middle East could impact output from the key exporting region.
The U.S. dollar rallied broadly on Tuesday after Federal Reserve Chair Jerome Powell pushed back against bets on more supersized interest rate cuts.
Share markets turned hesitant in Asia on Monday as strife in the Middle East offset more policy measures in China, while the Nikkei dived on concerns Japan's new prime minister favoured normalising interest rates.