Asian markets mostly fell again Tuesday as investors try to assess the economic impact of the Ukraine war, while oil prices extended gains after rocketing to a near 14-year high.

As Russia's invasion of its neighbour continues, commodity prices have been sent to record or multi-year highs, forcing observers to re-evaluate their outlook for the global recovery with some now warning of a period of soaring inflation and low growth or recession.

Monday's session saw a sea of red across trading floors after the United States said it was considering banning the import of crude from Russia, the world's number three producer, sending the price of Brent to almost $140 for the first time since 2008.

While the black gold eased back slightly it remains elevated and continued to rise again on Tuesday, with Brent holding above $125 and WTI north of $120.

Europe was not so keen on the idea, with German Chancellor Olaf Scholz saying Russian oil and gas are of "essential importance" to the continent's economy. Roughly 40 percent of EU gas imports and one quarter of its oil come from Russia.

Meanwhile, Moscow warned that in retaliation for strict sanctions imposed on it for the invasion, it could cut off natural gas supplies to Europe via the Nord Stream 1 pipeline.

European gas prices hit records Monday, while other commodities sourced from Ukraine and Russia also rallied, with nickel and wheat at new all-time highs.

The crisis comes just as uncertainty was rising owing to surging prices caused by a spike in demand for oil, tight supplies and pandemic-induced supply chain snarls, among other things.

Meanwhile, central banks are starting to wind back the ultra-loose monetary policies put in place at the start of the pandemic as they try to get a grip on runaway prices.

And while analysts have lowered their expectations for how much and how quickly officials will tighten in light of the war, they still see a tougher investing environment down the line.

"It's all about slowing growth and rising inflation," Alifia Doriwala of Rock Creek told Bloomberg Television. "With the sanctions on Russia intensifying, it's hitting all sectors. Then you are going to have some central bank action amidst much uncertain economic growth."

After a rout on US markets, Asia was again in negative territory, though the losses were less severe than the previous two days.

Tokyo, Hong Kong, Shanghai, Sydney, Seoul, Singapore, Wellington, Taipei and Manila were all off, though Jakarta eked out small gains.

- Key figures around 0300 GMT -  

Tokyo - Nikkei 225: DOWN 0.3 percent at 25,143.52 (break)

Hong Kong - Hang Seng Index: DOWN 0.3 percent at 20,989.79

Shanghai - Composite: DOWN 1.2 percent at 3,333.80

Brent North Sea crude: UP 2.0 percent at $125.65 per barrel

West Texas Intermediate: UP 1.0 percent at $120.53 per barrel

Dollar/yen: UP at 115.43 yen from 115.27 yen late Monday

Euro/dollar: DOWN at $1.0880 from $1.0858

Pound/dollar: DOWN at $1.3125 from $1.3109

Euro/pound: UP at 82.90 pence from 82.79 pence

New York - Dow: DOWN 2.4 percent at 32,817.38 (close)

London - FTSE 100: DOWN 0.4 percent at 6,959.48 (close)