The South Korean currency, the won, depreciated against the US dollar on Thursday following a surge in global oil prices due to concerns about supply disruptions in the Middle East. The won opened at 1,480.1 per dollar, down 13.6 won from the previous session, after showing some recovery in the past two sessions.
Despite recent gains, the won weakened again as global oil prices rose, with Iran disrupting cargo traffic through the Strait of Hormuz and escalating tensions in the region. This increase in oil prices occurred even as efforts were made to mitigate supply disruptions, including the release of large oil stockpiles by the International Energy Agency and the United States.
The foreign exchange and stock markets in South Korea experienced high volatility due to escalating tensions in the Middle East, particularly following US-Israeli actions against Iran. The rise in oil prices has put pressure on the Korean won, as the country heavily relies on energy imports, leading to increased demand for dollars to pay for crude imports.
The benchmark Korea Composite Stock Price Index (KOSPI) opened lower on Thursday, tracking losses on Wall Street amid concerns about a prolonged conflict. South Korean stocks also started slightly lower, influenced by the fluctuating oil prices and disruptions in the Middle East. The Korean won saw a significant decline against the US dollar, reflecting the broader market trends.
