Australian shares are poised to fall on Tuesday after oil prices jumped more than 4% on escalating Middle East tensions, including reports that Iran has halted indirect talks with the US and threats to disrupt shipping through the Strait of Hormuz.

Sentiment was also dented by the escalating Israel-Lebanon conflict, as Israeli forces advanced deeper into Lebanon in their ongoing operations against Hezbollah.

Overnight, the S&P 500, the Nasdaq Composite, and the Dow Jones Industrial Average rose 0.3%, 0.4%, and 0.1%, respectively.

In the macroeconomy, the ANZ-Roy Morgan Australian consumer confidence rose 2.7 points to 68.8 in the week of May 25 to May 31, ANZ reported Tuesday.

Australia's balance of payments and international investment position, building approvals, business indicators, and mineral and petroleum exploration reports are due at 11:30 am Sydney time.

In corporate news, Atlas Arteria (ASX:ALX) issued a supplementary target statement that continues to recommend the rejection of a takeover bid by IFM Global Infrastructure Fund.

Star Entertainment Group (ASX:SGR) secured a $390 million senior secured financing facility from WhiteHawk Capital Partners, strengthening liquidity and refinancing existing debt amid ongoing operational and financial pressures.

Australia's benchmark index edged down 0.03% or 2.3 points to close at 8,729.40 on Monday.