South Korean shares closed marginally lower on Tuesday as higher oil prices heightened inflation concerns and lifted U.S. Treasury yields amid ongoing Middle East tensions.

The Korea Composite Stock Price Index, or Kospi, decreased by 18.93 points, or about 0.3%, to close at 6,870.81. The Kosdaq rose by 3.22 points, or 0.4%, to close at 849.8.

Oil prices extended gains Tuesday as a lack of progress in the U.S.-Iran diplomatic efforts kept concerns over potential Middle East supply disruptions elevated, despite signs of a recovery in regional crude exports.

Brent crude futures for November delivery rose 2.15% to $100.20 a barrel, while West Texas Intermediate futures gained 1.8% to $94.30. Brent had neared $108 a barrel in the previous session before paring gains to settle around $105.

In economic news, South Korea's overseas direct investment jumped 32.3% to $20.52 billion in the second quarter from $15.50 billion a year earlier, the Ministry of Finance and Economy said in a Tuesday release.

Investment continued to increase for the fourth straight quarter, extending the upward trend that began in Q3 2025. Q2's figure marked a slight decline from $22.12 billion in the first quarter.

By sector, finance and insurance led overseas direct investments with $10.48 billion, followed by manufacturing at $3.57 billion, information and communications at $2.73 billion, and scientific and technical services and real estate at $660 million each. Among the top five sectors, all except real estate recorded growth, with information and communications jumping 265.3%.

In corporate news, OCI Company (KRX:456040) suspended its Toluene Diisocyanate (TDI) manufacturing and sales business, in a bid to phase out its underperforming businesses, according to a Tuesday filing with the Korea Exchange.

OCI's profitability is expected to improve because of the restructuring. The business will be suspended on Dec. 18.

Shares of the company fell over 5% at market close.