Asian-Pacific stock markets experienced an upswing on Tuesday, driven by optimism about a potential agreement between the United States and Iran, despite ongoing U.S. efforts to obstruct Iranian shipping in the Strait of Hormuz.

Although the ceasefire between the U.S. and Iran remains technically intact, it is under severe strain, with both nations accusing each other of breaching the agreed-upon terms.

On Monday, the U.S. announced it would begin preventing vessels from accessing Iranian ports in the Strait of Hormuz. This move is intended to increase pressure on Iran to reconsider reopening this vital oil passage following unsuccessful peace negotiations. The blockade was implemented starting at 10 a.m. ET.

In response, Iranian representatives cautioned that the U.S. blockade could lead to a significant rise in global energy prices.

“Enjoy the current pump figures. With the so-called ‘blockade’, Soon you’ll be nostalgic for $4–$5 gas,” Iran’s parliamentary speaker, Mohammad Bagher Ghalibaf, said in an X post Sunday.

Investors in Asia will also be watching out for China trade data later in the day.

The West Texas Intermediate was 2.16% lower at $96.94 per barrel as of 9:31 p.m. ET. Brent crude declined 1.82% to $97.55 per barrel.

Japan’s Nikkei 225 extended early gains to rise 2.43%, while the Topix gained 1.01%.

Australia’s S&P/ASX 200 was 0.53% higher. Australian business confidence in March dropped, weighed by concerns over the Iran war that had led to a global oil shock, according to a survey from National Australia Bank, Reuters reported.

Mainland China’s CSI300 index rose 0.65%, while Hong Kong’s Hang Seng index  was 1% higher.