Japan's Nikkei rallies on efforts to reopen critical oil shipping lane

By Rocky Swift

TOKYO, April 3 (Reuters) - Japan's Nikkei share average rallied on Friday, trimming its losses for the week, following global efforts to restore Gulf oil shipments interrupted by the war in Iran.

Artificial intelligence (AI)-related stocks led the Nikkei higher, with the gauge .N225 rising 1.31% to 53,147.35 in early trade, poised for a 0.4% retreat on the week. The broader Topix .TOPX climbed 1.12% to 3,652.13.

Dozens of countries sought ways overnight to restart vital energy shipments through the Strait of Hormuz after U.S. President Donald Trump vowed more aggressive attacks on Iran.

Since it began with a joint U.S.-Israeli aerial assault on Iran on February 28, the conflict continues to spread chaos across the region, driving prices for petroleum products sharply higher. Japan's economy remains exposed to spikes in crude oil prices due to its reliance on imported energy.

"Growing expectations for the reopening of the Strait of Hormuz have led to a drop in crude prices in Tokyo, which appears to be supporting the Japanese stock market," said Wataru Akiyama, a strategist at Nomura Securities.

"As uncertainty surrounding the Middle East situation has somewhat subsided, and against the backdrop of AI advancements, expectations are growing that earnings reports, which will begin in earnest around the middle of this month, will confirm strong performance," he added.

There were 201 advancers on the Nikkei index against 24 decliners. AI industry bellwethers Advantest 6857.T and Tokyo Electron 8035.T rose 1.9% and 1.5%, respectively.

The largest losers on the Nikkei were Chugai Pharmaceutical 4519.T, down 4.1%, followed by home furnishings maker Nitori 9843.T, which lost 3.5%.