Asia-Pacific markets fell Thursday, tracking Wall Street losses overnight, as tensions between Iran and the U.S. keep oil prices elevated, stoking energy and inflation worries.

The Kuwait International Airport was struck by Iran early Wednesday, just a day after the U.S. Central Command said it had defeated multiple Iranian ballistic missiles and drones, as well as launched "self-defense strikes" on Qeshm Island in the Persian Gulf. This was in response to "attempted attacks" by Tehran, it said.

If necessary, Israel and the U.S. are prepared to strike Iran again, Israeli Prime Minister Benjamin Netanyahu told CNBC in an exclusive interview.

"Israel is ready and the U.S. forces are ready. I think Iran should take that into account. I think they are taking into account, but they're playing with fire," Netanyahu said.

West Texas Intermediate futures gained more than 2% to close at $96.02 on Wednesday, while international benchmark Brent crude  advanced nearly 2% to settle at $97.81 per barrel. Futures were about 0.8% lower Thursday.

South Korea's Kospi ended Thursday's session 1.84% lower at 8,639.41, but the small-cap Kosdaq advanced over 2.31% at 1,049.73 as trading resumed after a holiday.

Japan's Nikkei 225 fell 1.36% at 67,470.69 after hitting a record high in the previous session, while the Topix declined 1.11% at 3,951.85. SoftBank Group dropped over 10% amid a broader decline in Asia tech stocks.

Australia's S&P/ASX 200 fell 1.88% to 8,686.10.

Mainland China's CSI 300 fell 0.69% at 4,904.75, while Hong Kong's Hang Seng lost 1.31% in its last hour of afternoon trade.

India's Nifty 50 was marginally higher, while the BSE Sensex was flat.