Asian stocks have sunk after a ratings downgrade rattled Europe and crucial talks aimed at nudging Greece towards solvency were mired in disagreement.
Benchmark oil prices were slightly higher near 99 US dollars per barrel and the dollar rose against the euro but fell against the yen.
Japan's Nikkei 225 index slid 1.5% to 8373 and Hong Kong's Hang Seng lost 1% at 19022. South Korea's Kospi index dropped 1.1% to 1856.
Benchmarks in Singapore, Taiwan, India, Indonesia and mainland China also fell.
Standard & Poor's decision on Friday to strip France of its top-notch credit rating and to downgrade eight other nations that use the euro battered investment sentiment, raising fears that a solution to the continent's sovereign debt crisis may be far off.
Negotiations between the Greek government and its private creditors on a bond swap nearly collapsed on Friday. The deal would reduce Greece's debt by 100 billion euro by swapping private creditors' bonds with new ones of a lower value.
Without the swap, debt-crippled Greece is unlikely to secure a second financial bailout - which could hurtle the country into bankruptcy and send economic shock waves around the world. Greece's first bailout came in 2010.
Early trading in Europe was skittish. Britain's FTSE 100 was up 0.2% at 5,650 and Germany's DAX added 0.5% to 6174. The CAC-40 in Paris rose just 0.1% to 3200 on the first trading day after a downgrade of France's long-term credit rating by Standard and Poor's. Markets in the US are closed for a public holiday.
"There is growing risk of a disorderly default by Greece, with talks reportedly breaking down after private sector creditors could not agree on the coupon level of fresh bonds," said Stan Shamu of IG Markets in Melbourne, Australia.
"With a 14.4 billion euro bond repayment due in March, and without restructuring in place, the entire sum would fall, making it increasingly likely that Greece will default," Mr Shamu wrote in a email.