Japan’s stock market has gained significantly due to strong corporate earnings. However, the rising cost of crude oil is threatening this trend. A 10% increase in Brent crude prices could reduce Japanese companies’ net income by 1-2%. The current price of $104 a barrel is more than 50% above last year’s average, making it a heavy burden for Japan, which relies almost entirely on imported oil.
Source: https://www.bloomberg.com/news/articles/2026-03-16/japan-stocks-face-earnings-risk-as-iran-conflict-lifts-oil-costs