The Korean won weakens due to risk-averse sentiment, while rising oil prices increase import cost pressures

⑴ The Korean won weakened to around 1487 against the US dollar, extending the previous trading day's decline due to renewed tensions in the Middle East, which have worsened global sentiment.⑵ Earlier, negotiations between the US and Iran failed to reach an agreement. Subsequently, the US decided to impose a maritime blockade on Iranian ports. This escalation has heightened concerns over a prolonged conflict and supported safe-haven demand for the US dollar.⑶ Meanwhile, crude oil prices climbed above $100 per barrel, increasing energy import costs and putting pressure on the Korean won. As a major energy importer, South Korea is highly sensitive to oil price fluctuations.⑷ Foreign investors' selling in the Korean stock market has increased capital outflow pressure, while weakening global market risk appetite has also weighed on the Korean won.⑸ Domestically, authorities are seeking to stabilize energy supplies and diversify crude oil imports, including sourcing from Kazakhstan and the United States.