The South Korean won weakened against the US dollar on Tuesday, hitting a 17-year low as escalating tensions in the Middle East stoked concerns about potential disruptions to global oil supplies and broader economic instability.
The won opened at 1,519.9 per dollar, a decrease of 4.2 won from the previous trading session, continuing its downward trend.
This marks the lowest exchange rate since March 10, 2009, when the won reached 1,561 per dollar during intraday trading as South Korea navigated the global financial crisis.
The won has been fluctuating around the key psychological level of 1,500 in recent sessions, having closed as low as 1,517.3 last week. The ongoing conflict, intensified following reported US-Israeli strikes, shows no immediate signs of resolution.
On Monday (US time), former US President Donald Trump reportedly threatened to “completely obliterate” Kharg Island, a vital oil hub, along with Iran’s power plants and oil infrastructure if a swift peace agreement with Washington isn’t reached.
However, Tehran dismissed these peace proposals as “unrealistic, illogical and excessive.” Simultaneously, foreign media reported that a parliamentary security committee approved a draft bill to implement a toll system for vessels passing through the Strait of Hormuz.
These escalating tensions have driven up global oil prices. US West Texas Intermediate (WTI) crude oil futures for May delivery increased by 3.25 percent to $102.88 per barrel, surpassing the $100 mark at closing for the first time since July 2022.
