Australian shares are set to open lower on Thursday after oil prices surged above US$100 a barrel overnight and the prospect of a near-term peaceful resolution to the war between the United States and Iran faded.
ASX futures were down 88 points or 1% at 8,816.0.
U.S. Treasury Secretary Scott Bessent's plan to triple the potential buyback of long-term government debt also fell short of expectations.
The U.S. Treasury Department said it would buy up to US$6 billion of outstanding securities maturing in the 10- to 20-year sector, up from an initial $2 billion cap.
Some market watchers had expected a target of $10 billion.
U.S. benchmark averages closed lower on Wednesday amid escalating tensions in the Middle East and ahead of key inflation data due later in the week.
The Dow Jones Industrial Average fell 405.4 points or 0.8% to 52,380.7, the S&P 500 declined 37.2 points or 0.5% to 7,636.4, and the Nasdaq lost 168.1 points or 0.6% to 26,253.3.
The Australian sharemarket also retraced early gains to close lower on Wednesday.
The S&P/ASX 200 Index fell 9.40 points or 0.1% to 8,911.4, its lowest close since 28 July, with seven of the 11 sectors finishing lower.
On the bond markets, the 10-year Treasury yield was up 1.5% to 5.275%, while the two-year rate fell 0.3% to 4.921%.
